Southern Heritage Bank has now taken a step it feels will allow it to be a stronger financial entity while retaining that community independence for serving customers.
The bank has announced it will partner with First Citizens Bancshares Inc. and will complete that merger by the end of this summer, pending the approval of Southern Heritage’s shareholders as well as federal and state regulatory authorities.
Following the completion of the merger, Southern Heritage will retain its name and will remain a separately chartered bank operating as a subsidiary of First Citizens Bancshares Inc.
First Citizens will extend its branch footprint statewide while solidifying its position as the seventh-largest Tennessee-based community bank.
J. Lee Stewart, Southern Heritage president and CEO, will continue to serve in this capacity following the transaction and will join the First Citizens board of directors.
“We are very excited about the long-lasting opportunities that will be generated through this partnership between our very ‘customer-centric’ organizations,” Stewart said. “Our cultures, core values, and strategies align very well, and we are both committed to the respective communities we serve.”
Stewart also noted the way this merger is taking place is a unique one.
“With this structure Southern Heritage will be able to advance the mission and values we started with while becoming a part of a larger, high-performing, statewide, banking company with a remarkably similar culture and customer focus,” Stewart said.
Southern Heritage’s Steve Ledbetter, chief operating officer, who will remain in that position following the merger, said he believes the partnership will be good for the bank’s customers and shareholders.
“We are convinced this partnership will greatly benefit our shareholders, co-workers, clients and communities over the long run, and look forward to joining the tremendous team of dedicated professionals at First Citizens,” Ledbetter said.
The transaction is valued at $24.50 per share of Southern Heritage common stock or approximately $32.2 million.
Under the terms of the merger agreement, which was unanimously approved by the boards of both companies, shareholders of Southern Heritage will be able to elect to receive consideration in the form of 0.5751 shares of First Citizens stock, $24.50 in cash, or a combination of stock and cash comprised of 0.2876 shares of First Citizens stock and $12.25 in cash for each share of Southern Heritage common stock.
The allocation of the total form of consideration and the total and per share consideration amount is subject to proration and adjustment under certain circumstances as provided in the merger agreement.
Southern Heritage currently reports $237 million in total assets and $206 million in total deposits.
First Citizens, which was founded in 1889, has $1.2 billion in total assets with 21 branches throughout West and Middle Tennessee and is headquartered in Dyersburg.