IBERIABANK Corp. (IBKC) to Acquire Florida Gulf Bancorp in Cash and Stock Deal
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IBERIABANK Corporation (Nasdaq: IBKC) and Florida Gulf Bancorp, Inc., have signed a definitive agreement for IBERIABANK to acquire Florida Gulf. The transaction has been approved by the Board of Directors of each company and is expected to close in the third quarter of 2012. Completion of the transaction is subject to customary closing conditions, including the receipt of required regulatory approvals and the approval of Florida Gulf's shareholders.
Under the terms of the agreement, shareholders of Florida Gulf will receive a fixed value of $23.00 of IBERIABANK common stock for each share of Florida Gulf common stock outstanding, subject to certain adjustments. In addition, the agreement provides for potential additional cash consideration based on the resolution of certain identified loans over a three-year period after the acquisition. The maximum contingent cash consideration is $4.4 million, or $2.85 per share of Florida Gulf common stock. Florida Gulf also had approximately $4.1 million in preferred stock at December 31, 2011, that will be redeemed at consummation of the acquisition.
At December 31, 2011, Florida Gulf had 1,528,357 shares of common stock outstanding and warrants to purchase 41,410 shares that are expected to be exercised prior to closing the transaction. At December 31, 2011, Florida Gulf had 135,103 shares underlying outstanding options at a weighted average exercise price of $18.30 per share. Based on IBERIABANK's closing stock price on March 16, 2012 of $54.80, the transaction would have an aggregate estimated pro forma value of $43.7 million, assuming the exercise of all warrants, the value of shares underlying outstanding options (approximately $3.4 million), the redemption at closing of the preferred stock ($4.1 million), and excluding any potential contingent cash consideration. This aggregate transaction value equated to 1.41 times book value and tangible book value at December 31, 2011, assuming the exercise of options and warrants on a pro forma basis.
IBERIABANK expects the transaction to be accretive to earnings per share approximately 1%, assuming synergies are fully phased in and excluding estimated merger and conversion related costs of approximately $5.8 million on a pre-tax basis. Estimated synergies include annual pre-tax expense savings of approximately 30%, to be fully achieved by the first quarter of 2013. The estimated internal rate of return for the transaction is expected to be in the "mid-teens" and in excess of IBERIABANK's cost of capital.
Under the terms of the agreement, shareholders of Florida Gulf will receive a fixed value of $23.00 of IBERIABANK common stock for each share of Florida Gulf common stock outstanding, subject to certain adjustments. In addition, the agreement provides for potential additional cash consideration based on the resolution of certain identified loans over a three-year period after the acquisition. The maximum contingent cash consideration is $4.4 million, or $2.85 per share of Florida Gulf common stock. Florida Gulf also had approximately $4.1 million in preferred stock at December 31, 2011, that will be redeemed at consummation of the acquisition.
At December 31, 2011, Florida Gulf had 1,528,357 shares of common stock outstanding and warrants to purchase 41,410 shares that are expected to be exercised prior to closing the transaction. At December 31, 2011, Florida Gulf had 135,103 shares underlying outstanding options at a weighted average exercise price of $18.30 per share. Based on IBERIABANK's closing stock price on March 16, 2012 of $54.80, the transaction would have an aggregate estimated pro forma value of $43.7 million, assuming the exercise of all warrants, the value of shares underlying outstanding options (approximately $3.4 million), the redemption at closing of the preferred stock ($4.1 million), and excluding any potential contingent cash consideration. This aggregate transaction value equated to 1.41 times book value and tangible book value at December 31, 2011, assuming the exercise of options and warrants on a pro forma basis.
IBERIABANK expects the transaction to be accretive to earnings per share approximately 1%, assuming synergies are fully phased in and excluding estimated merger and conversion related costs of approximately $5.8 million on a pre-tax basis. Estimated synergies include annual pre-tax expense savings of approximately 30%, to be fully achieved by the first quarter of 2013. The estimated internal rate of return for the transaction is expected to be in the "mid-teens" and in excess of IBERIABANK's cost of capital.
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