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United Bancshares Obtains Regulatory Nod to Acquire Piedmont Bancorp
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United Bancshares Inc. (UBSI - Free Report) has obtained the requisite regulatory approvals to acquire Piedmont Bancorp, Inc. ("Piedmont"). The transaction is anticipated to be completed in early 2025, with system integration expected to be completed by late first-quarter 2025, subject to customary closing requirements.
UBSI’s Piedmont Acquisition Details
United Bancshares announced the acquisition of Piedmont this May in an all-stock transaction valued at $267 million. Also, a one-time pre-tax merger expense of $27.6 million is expected to be incurred.
Piedmont Bancorp, headquartered in Peachtree Corners, GA, through its subsidiary, The Piedmont Bank, operates in 16 locations across Atlanta region and North Georgia.
The combined entity is anticipated to have more than $32 billion in total assets and a network of approximately 240 locations across eight states and Washington, D.C.
Upon the completion of the deal, Piedmont will be merged into UBSI and existing Piedmont offices will function under the name of United Bancshares in the state of Georgia.
Richard M. Adams, Jr., CEO of United Bankshares, Inc., stated, “We are pleased to have received regulatory approval from the Federal Reserve and state banking authorities for this merger, and we remain excited about expanding our footprint into the greater Atlanta area.”
Rationale Behind United Bancshares’ Merger Pursuit
The deal is anticipated to be 7.6% and 8.3% accretive to UBSI’s 2025 and 2026 earnings per share, respectively, with a tangible book value (TBV) earn-back period of 2.8 years.
United Bancshares’ TBV is expected to be 3.5% dilutive with an internal rate of return of 20%. Moreover, UBSI will likely benefit from incremental operational efficiencies with expected cost savings of 25% of Piedmont’s non-interest expense base, 75% of which will be realized in 2025 and the rest thereafter.
This transaction will enhance United Bancshares’ presence in the lucrative Southeast and Mid-Atlantic region, establishing it as one of the premier regional banking companies.
This move aligns with UBSI’s inorganic growth strategy to deepen its presence in attractive markets and boost its profitability. This deal represents the bank’s 34th acquisition.
UBSI’s Zacks Rank & Price Performance
Year to date, shares of United Bancshares have risen 12% compared with the industry’s 31.9% growth.
Last month, Old National Bancorp. (ONB - Free Report) announced its decision to acquire Bremer Financial Corp. The transaction is valued at $1.4 billion. The consideration will be paid through 50 million shares of ONB and $315 million in cash.
This transaction is likely to improve ONB’s deposit mix through low-cost and granular deposits. It will also establish the company as the premier regional bank in the Midwest, deepening its footprint in lucrative markets. The deal will expand the wealth management business and contribute to high-value and lower-volatility revenues.
Similarly, ACNB Corp. (ACNB - Free Report) obtained requisite regulatory approvals or waivers to acquire Traditions Bancorp, Inc. and its wholly-owned subsidiary, Traditions Bank. The deal was announced in July.
The approval has been issued by the Federal Deposit Insurance Corporation and the Pennsylvania Department of Banking and Securities.
The deal is anticipated to be 29.1% and 29.6% accretive to ACNB’s 2025 and 2026 earnings per share, respectively, assuming the execution of cost savings. Also, TBV is expected to be diluted by roughly 9.2%, with a projected earn-back period of approximately 2.25 years.
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United Bancshares Obtains Regulatory Nod to Acquire Piedmont Bancorp
United Bancshares Inc. (UBSI - Free Report) has obtained the requisite regulatory approvals to acquire Piedmont Bancorp, Inc. ("Piedmont"). The transaction is anticipated to be completed in early 2025, with system integration expected to be completed by late first-quarter 2025, subject to customary closing requirements.
UBSI’s Piedmont Acquisition Details
United Bancshares announced the acquisition of Piedmont this May in an all-stock transaction valued at $267 million. Also, a one-time pre-tax merger expense of $27.6 million is expected to be incurred.
Piedmont Bancorp, headquartered in Peachtree Corners, GA, through its subsidiary, The Piedmont Bank, operates in 16 locations across Atlanta region and North Georgia.
The combined entity is anticipated to have more than $32 billion in total assets and a network of approximately 240 locations across eight states and Washington, D.C.
Upon the completion of the deal, Piedmont will be merged into UBSI and existing Piedmont offices will function under the name of United Bancshares in the state of Georgia.
Richard M. Adams, Jr., CEO of United Bankshares, Inc., stated, “We are pleased to have received regulatory approval from the Federal Reserve and state banking authorities for this merger, and we remain excited about expanding our footprint into the greater Atlanta area.”
Rationale Behind United Bancshares’ Merger Pursuit
The deal is anticipated to be 7.6% and 8.3% accretive to UBSI’s 2025 and 2026 earnings per share, respectively, with a tangible book value (TBV) earn-back period of 2.8 years.
United Bancshares’ TBV is expected to be 3.5% dilutive with an internal rate of return of 20%. Moreover, UBSI will likely benefit from incremental operational efficiencies with expected cost savings of 25% of Piedmont’s non-interest expense base, 75% of which will be realized in 2025 and the rest thereafter.
This transaction will enhance United Bancshares’ presence in the lucrative Southeast and Mid-Atlantic region, establishing it as one of the premier regional banking companies.
This move aligns with UBSI’s inorganic growth strategy to deepen its presence in attractive markets and boost its profitability. This deal represents the bank’s 34th acquisition.
UBSI’s Zacks Rank & Price Performance
Year to date, shares of United Bancshares have risen 12% compared with the industry’s 31.9% growth.
Image Source: Zacks Investment Research
Currently, UBSI carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Similar Steps by Other Banks
Last month, Old National Bancorp. (ONB - Free Report) announced its decision to acquire Bremer Financial Corp. The transaction is valued at $1.4 billion. The consideration will be paid through 50 million shares of ONB and $315 million in cash.
This transaction is likely to improve ONB’s deposit mix through low-cost and granular deposits. It will also establish the company as the premier regional bank in the Midwest, deepening its footprint in lucrative markets. The deal will expand the wealth management business and contribute to high-value and lower-volatility revenues.
Similarly, ACNB Corp. (ACNB - Free Report) obtained requisite regulatory approvals or waivers to acquire Traditions Bancorp, Inc. and its wholly-owned subsidiary, Traditions Bank. The deal was announced in July.
The approval has been issued by the Federal Deposit Insurance Corporation and the Pennsylvania Department of Banking and Securities.
The deal is anticipated to be 29.1% and 29.6% accretive to ACNB’s 2025 and 2026 earnings per share, respectively, assuming the execution of cost savings. Also, TBV is expected to be diluted by roughly 9.2%, with a projected earn-back period of approximately 2.25 years.