Banking

IberiaBank expansion continues

by Walter Pierce

The Lafayette-based bank announced Friday the acquisition of Florida Bank Group Inc.

IberiaBank's robust expansion in the southeastern U.S. continues with the corporation announcing Friday the acquisition of Florida Bank Group Inc. - a move, pending the clearing of regulatory hurdles and shareholder approval, that will allow the Lafayette-based bank to expand into markets in Tampa, Jacksonville, Sarasota and Tallahassee.

According to terms of the agreement, FBG shareholders will receive a combination of cash and IberiaBank common stock. "Florida Bank Group common shares are assumed to total approximately 5,051,745 shares at closing, assuming approximately 2,471,745 common shares outstanding, approximately 2,480,000 common shares associated with the conversion of the convertible preferred stock into common shares, and 100,000 warrants outstanding that are assumed to be exercised prior to closing," the merger announcement reads.

Other terms of the deal include:

Cash consideration: Florida Bank Group shareholders shall receive cash equal to $7.81 per share of then outstanding Florida Bank Group common stock, including shares of preferred stock that will convert to common shares in the merger. Aggregate cash consideration is approximately $39.4 million.

Stock consideration: Each Florida Bank Group common share will be exchanged for 0.149 share of IBKC common stock, subject to certain market price adjustments provided for in the merger agreement. Based on IBKC's closing stock price on October 2, 2014, of $62.61 per share, the stock consideration would equate to $9.33 per Florida Bank Group common share, or approximately $47.1 million.

Unvested stock option consideration: As of Sept. 30, 2014, FBG had 374,400 unvested stock option shares outstanding with an exercise price of $7.74 per share. These stock options are anticipated to be in-the-money at closing. The merger agreement provides that any Florida Bank Group stock options and warrants that remain outstanding immediately prior to closing, whether or not vested, will be cashed out at consummation of the merger. Based on IBKC's closing stock price on October 2, 2014, of $62.61, the cash value for optional shares would be $3.5 million.

A small bank centered on business lending, Florida Bank Group has 13 branches in the Tampa area, three in Jacksonville and one each in Tallahassee and Sarasota. Its total consolidated assets equal $524 million with $172 million in total cash and investment securities.

IberiaBank President and CEO Daryl Byrd praised his FBG counterpart, Susan Martinez, and her staff for ensuring a smooth transaction: "Susie Martinez, her team, and the Florida Bank Group Board of Directors have done an outstanding job in rebuilding their organization and preparing for future client growth opportunities. We are very excited to be teaming up with them and entering the Tampa Bay market in such a high-quality manner. The Tampa Bay area has a very strong concentration of commercial and industrial companies, which is a segment of banking in which our company excels. With the addition of Florida Bank Group, we will extend our brand throughout the west coast of central and south Florida and into Jacksonville in northeast Florida."