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Glacier on Buyout Spree, to Buy Heritage Bancorp for $240.7M

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Glacier Bancorp (GBCI - Free Report) has signed a stock-cash merger agreement with the bank holding company for Heritage Bank of Nevada — Heritage Bancorp. Notably, Glacier expects the deal to be immediately accretive to earnings per share, excluding one-time transaction-related costs.

The deal has been valued at $240.7 million and is expected to close in the third quarter of 2019. Though the transaction has received unanimous approval from the boards of Glacier and Heritage, it is subject to necessary regulatory approval and other conditions of closing.

Based in Reno-NV, Heritage had total assets of $829.7 million, gross loans of $595.6 million and total deposits of $720.5 million as of Dec 31, 2018. Also, with this buyout, Glacier will have access to Heritage’s seven banking offices located in Carson City, Gardnerville, Reno and Sparks.

Per the terms of agreement, Glacier will pay four of each share of its common stock and $12 in cash for each share of Heritage.

Randy Chesler, President and CEO at Glacier said, “This is a rare opportunity to expand our presence into Northern Nevada, a fast-growing market with a diverse economy that is continually attracting substantial investment from large technology and growth companies.”

Opportunistic buyouts continue to be a key part of the company’s growth strategy. Prior to this, in January 2019, Glacier announced plans to acquire FNB Bancorp and its wholly-owned subsidiary, The First National Bank of Layton.  

Further, in 2018, the company had acquired two community banks — Inter-Mountain Bancorp and Columbine Capital Corp. — which together contributed to about 15% growth in asset size in 2018. Also, these buyouts expanded Glacier’s reach in areas such as Montana and Mountain and Front Range communities of Colorado.

Glacier’s expansion into carefully selected markets bode well for the long term and is indicative of its strong financial position. The company has witnessed decent organic growth over the last few years and is well poised to benefit from the improving economic backdrop.

Shares of Glacier have gained 7.4% over the past year against the industry’s decline of 9%.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the same space are Bank of Marin Bancorp (BMRC - Free Report) , Bay Commercial Bank (BCML - Free Report) and Midland States Bancorp (MSBI - Free Report) . All these stocks carry a Zacks Rank #2 (Buy).

Bank of Marin’s Zacks Consensus Estimate for current-year earnings has been revised 1.2% upward in the past 60 days. Also, its share price has increased 16.8% in the past year.

Bay Commercial Bank’s current-year earnings estimates have been revised 3.3% upward over the past 60 days. Further, the company’s shares have jumped 3% in the past 12 months.

Midland States’ Zacks Consensus Estimate for current-year earnings has remained stable over the past 60 days. Moreover, in the past year, its shares have gained 23.3%.

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