Iberiabank (IBKC) Set to Acquire Florida Bank Group - Analyst Blog

Iberiabank Corp. (IBKC), the holding company of Iberiabank and Florida Bank Group, Inc., has entered into a definitive agreement wherein Iberiabank will acquire Florida Bank Group. Through the acquisition of a small and sound business-focused bank, Iberiabank will enter into the major cities of Florida such as Tampa, Jacksonville and Tallahassee. Further, the combined entity is expected to become a stronger financial institution, serving its clients and communities.

The Board of Directors of both companies have approved the merger, which is expected to close in first-quarter 2015. However, the deal is still subject to some customary regulatory approvals and that from shareholders of Florida Bank Group.

According to the terms of the agreement, Florida Bank Group's shareholders will receive a combination of cash and Iberiabank's common stocks. Each shareholder of Florida Bank Group will receive cash equal to $7.81 per share of the then outstanding Florida Bank Group common stock. This includes shares of the preferred stock that will be converted to common shares in the merger.

Total cash consideration is around $39.4 million. Again, under stock consideration, each stock of Florida Bank Group will be exchanged for 0.149 share of Iberiabank common stock. Aggregate stock consideration is around $47.1 million.

For Iberiabank, the Lafayette, LA-based Southeast regional bank, this acquisition may prove fruitful. Strong presence of Florida Bank Group in Tampa Bay area (8 offices), which have a high concentration of industrial and commercial companies, is likely to complement Iberiabank's business well. On the other hand, Florida Bank Group's strength lies in efficiently servicing its high-quality clients. As a result, the combined entity is expected to emerge as a stronger force, capable of serving its clients in a better way.

Iberiabank currently holds a Zacks Rank #2 (Buy). Some better-ranked Southeast banks include First Community Bancshares, Inc. (FCBC), First NBC Bank Holding Co. (NBCB) and Simmons First National Corp. (SFNC). All these stocks sport a Zacks Rank #1 (Strong Buy).