First National Bankshares of Florida, Inc. Continues Growth Strategy with Acquisition of Southern Community Bancorp
March 22 2004 - 9:04AM
PR Newswire (US)
First National Bankshares of Florida, Inc. Continues Growth
Strategy with Acquisition of Southern Community Bancorp NAPLES,
Fla., March 22 /PRNewswire-FirstCall/ -- First National Bankshares
of Florida, Inc. and Southern Community Bancorp jointly announced
today the signing of a definitive agreement in which First National
Bankshares will acquire Southern Community Bancorp. The acquisition
will significantly enhance First National Bankshares' existing
Florida franchise and enable the company to expand into several new
banking markets. (Logo:
http://www.newscom.com/cgi-bin/prnh/20031230/FNBFLOGO )
Headquartered in Orlando, Florida, Southern Community Bancorp is
the holding company for Southern Community Bank of Central Florida,
Southern Community Bank of Southwest Florida and Southern Community
Bank of South Florida. As of February 29, 2004, the company had
$984 million in total assets and $852 million in deposits with 18
offices serving Naples, Bonita Springs, Fort Myers, Orlando, Lake
Mary, Altamonte Springs, Longwood, Winter Park, Daytona Beach, Port
Orange, Ormond Beach, Boca Raton, Fort Lauderdale, Palm Beach, Palm
Beach Gardens and West Palm Beach. "This acquisition fits perfectly
with our strategic plan for growth in the Florida market in several
ways," said Gary L. Tice, Chairman and Chief Executive Officer of
First National Bankshares. "First, it will significantly increase
our presence in the greater Orlando area, a fast-growing market
that we entered only two years ago. Secondly, this acquisition will
enable us to extend our highly successful banking operations to the
East Coast, which includes some of the most demographically
attractive markets in the entire state. Finally, we will enjoy
expanded opportunities for marketing our extensive financial
services." Under the terms of the definitive agreement, First
National Bankshares will exchange 1.62 shares of its common stock
for each share of Southern Community Bancorp common stock in a
tax-free exchange. The exchange ratio is subject to reduction if
the average closing price of First National Bankshares' common
stock exceeds $20.00 per share over a specified period prior to the
merger. Based upon First National Bankshares' March 19, 2004
closing price of $17.52 per share, the transaction has a total
indicated value of $226 million. In order to mitigate the dilutive
impact of Southern Community's stock options, First National
Bankshares will issue approximately $25 million in trust preferred
securities to fund the purchase of approximately 1.1 million of its
common shares. First National Bankshares expects the transaction to
be 1.0% accretive to GAAP earnings per share in 2005 and 1.7%
accretive to GAAP earnings per share in 2006. On a cash basis, the
transaction is expected to be 0.9% accretive to earnings per share
in 2005 and 2.5% accretive to earnings per share in 2006. The
transaction also is expected to enhance book value per share and
will be neutral to both regulatory capital and tangible capital.
Due diligence has already been completed. The transaction, which is
subject to normal regulatory and shareholder approvals, is expected
to close in the third quarter of 2004. Charlie W. Brinkley, Jr.,
Chairman and Chief Executive Officer of Southern Community Bancorp,
stated, "This merger combines two organizations which share a
common community banking philosophy with solid financial
performance and excellent credit quality. We are particularly
delighted to be partnering with a group that is specificallyfocused
on serving the local banking needs of Floridians. This merger also
will benefit our customers, who will enjoy a greatly expanded
network of conveniently located, full-service financial centers as
well as a broader array of financial products and services."
Brinkley will continue to serve in a leadership role by joining the
Board of Directors of First National Bankshares of Florida and
serving as Vice Chairman. All other key members of Southern
Community's senior leadership team will also join First National
Bankshares and/or its community banking subsidiary First National
Bank of Florida. Once the merger is completed, all Southern
Community Bank branches will become part of First National Bank of
Florida. First National Bank will then have 77 full-service
financial centers, approximately $5 billion in total assets and
nearly $4 billion in deposits, making it the largest, independent
commercial bank headquartered in the state of Florida. "This merger
provides us with an excellent branchsystem and a tremendous
opportunity to market a broad range of business and retail banking
services to a growing customer base," said Garrett S. Richter,
President and Chief Executive Officer of First National Bank of
Florida. "We are particularly excited about the opportunity to
offer a complete line of wealth management, investment and
insurance products to our new customers." As previously stated, the
acquisition will provide First National Bank with an entry into
some of Florida's most attractive markets. Palm Beach County, for
example, leads the state in per capita income at $45,312, according
to the University of Florida Bureau of Economic and Business
Research. The county also ranks third based on total population.
First National Bank alsowill increase market share in several key
markets. In the greater Orlando area, for example, First National
Bank will add six banking offices and $388 million in deposits.
Once the merger is completed, the bank will have 12 offices and
$620 million in total deposits, placing it among the top six
financial institutions in that market. First National Bankshares of
Florida will host a conference call to discuss the acquisition of
Southern Community Bancorp today at 2 p.m. Eastern Time. This
conference call will be available by dialing 1-800-346-7359, with
the entry code #1160. For those unable to listen to the live call,
a replay will be available from 4 p.m. on March 22, 2004 until
midnight on March 29, 2004, by dialing 1-800-332-6854, with the
entry code #1160. About First National Bankshares First National
Bankshares of Florida, Inc. is a $3.8 billion diversified financial
services company headquartered in Naples, Florida. The company
provides a wide variety of community banking, insurance andwealth
management services with 59 full-service financial centers located
throughout Southwest and Central Florida. The company's common
stock is traded on the New York Stock Exchange under the symbol
"FLB." About Southern Community Bancorp Headquartered in Orlando,
Florida, Southern Community Bancorp is the bank holding company for
three state-chartered commercial banks operating throughout
Florida. Southern Community provides a broad range of traditional
community banking services. It has $984 million in total assets and
$852 million in deposits with 18 banking offices. Transaction
Summary Exchange ratio (1) 1.62 FLB shares per SCB share Implied
price per SCB common share (2) (3) $28.38 Aggregate transaction
value (3) Approximately $226 million Form of consideration 100%
common stock Break-up fee $7.5 million Expected closing Third
Quarter 2004 Anticipated merger-related costs Approximately $5
million after-tax Anticipated post merger cost savings $2.7 million
(12% of 2004 estimated non-interest expenses) Anticipated goodwill
$122 million Anticipated core deposit intangibles $14.6 million
Southern Community Bancorp options To be converted into the right
to purchase FLB common stock based on the exchange ratio. FLB plans
to purchase shares of its common stock to fund option exercises.
Due diligence Completed Walk-away provision If FLB common stock
trades at an average price of less than $15.00 for a specified
period prior to closing, SCB has the right to terminate
transaction. Required approvals Regulatory and shareholder approval
from both companies Pricing overview Price to estimated 2004 EPS
25.1x Price to estimated 2005 EPS 18.1x Price to adjusted 12/31/03
book value ($9.52) 2.98x Price to adjusted 12/31/03 tangible book
value ($9.39) 3.02x Pro forma tangible equity to assets at closing
(12/31/04) 5.19x Notes: (1) Subject to reduction if the closing
price of FLB common stock exceeds $20.00 during a specified period
prior to the merger (2) Based on the closing price of FLB common
stock on March 19, 2004 (3) Includes dilutive impact of stock
options Additional information on the acquisition of Southern
Community Bancorp can be found by visiting First National
Bankshares's web site at http://www.firstnationalbankshares.com/
Except for the historical and present factual information contained
herein, the matters set forth in this release, including statements
as to the expected date of the closing of the acquisition of
Southern Community Bancorp by First National Bankshares of Florida,
Inc.,financial and operating results, benefits and synergies of the
merger, future opportunities and any other effect, result or aspect
of the transaction, and other statements identified by words such
as "believes," "expects," "projects," "plans," "anticipates," and
similar expressions, are forward-looking statements within the
meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. Such statements involve risks and
uncertainties including, but not limited to, costs, delays, and any
other difficulties related to the merger, failure of the parties to
satisfy closing conditions, risks and effects of legal and
administrative proceedings and governmental regulations, future
financial and operating results, competition, economic conditions,
ability to manage and continue growth, and other risk industry
factors as detailed from time to time in First National Bankshares'
and Southern Community Bancorp's reports filed with the SEC. First
National Bankshares and Southern Community Bancorp disclaim any
responsibility to update these forward-looking statements. First
National Bankshares will file with the Securities and Exchange
Commission a Registration Statement on Form S-4, which will contain
the prospectus of First National Bankshares relating to the shares
to be issued in the merger, and the proxy statements of First
National Bankshares and Southern Community Bancorp relating to the
special meetings of shareholders of First National Bankshares and
Southern Community Bancorp at which the merger agreement will be
considered and voted upon by their respective shareholders, as well
as other relevant documents concerning the proposed merger.
Investors are urged to read the joint proxy statement/prospectus
when it becomes available and any other relevant documents filed
with the SEC because they will contain important information. You
will be able to obtain the Form S-4 Registration Statement,
including the exhibits filed therewith free of charge at the
website maintained by the SEC at http://www.sec.gov/. In addition,
you may obtain documents filed with the SEC by First National
Bankshares free of charge by requesting them in writing from First
National Bankshares, 2150 Goodlette Road N., Naples, Fl., 34102,
Attention: Corporate Secretary, or by telephone at (800) 262-7600.
You may obtain documents filed with the SEC by Southern Community
Bancorp free of charge by requesting them in writing from Southern
Community Bancorp, 175 Timacuan Boulevard, Lake Mary, Fl., 32746.
First National Bankshares, Southern Community Bancorp and their
directors and executive officers may be deemed to be participants
in the solicitation of proxies from their respective shareholders
in connection with the merger. Information about such directors and
executive officers and their ownership of First National Bankshares
and Southern Community Bancorp stock is or will be set forth in the
proxy statement for each company's 2004 annual meeting of
shareholders which will be incorporated by reference in the Form
S-4 Registration Statement to be filed with the SEC and in the
joint proxy statement/prospectus to be mailed to First National
Bankshares and Southern Community Bancorp shareholders. Investors
may obtain additional information regarding the interests of such
participants by reading the proxy statement/prospectus when it
becomes available. CONTACT: Clay W. Cone Vice President, Director
of Corporate Communications 239-436-1676
http://www.newscom.com/cgi-bin/prnh/20031230/FNBFLOGODATASOURCE:
First National Bankshares of Florida, Inc. CONTACT: Clay W. Cone,
Vice President, Director of Corporate Communications, of First
National Bankshares of Florida, Inc., +1-239-436-1676 Web site:
http://www.firstnationalbankshares.com/
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