The deal between First BancTrust Corp. and First Mid-Illinois Bancshares Inc. was a largely straightforward affair.
First BancTrust Chairman and CEO Jack Franklin and First Mid-Illinois President and CEO Joe Dively have been informally meeting since 2016 to discuss their organizations. Dively first expressed First Mid-Illinois' interest in a strategic transaction with First BancTrust in spring 2017. On Aug. 4, 2017, First Mid-Illinois indicated a potential offer between $32 and $34 of its common stock for each First BancTrust common share. At the end of that month, First Mid-Illinois submitted its initial due diligence requests to First Bank.
In September 2017, the First Mid-Illinois board approved a preliminary nonbinding letter of intent proposing to acquire First BancTrust common shares for $34.00 per share, payable in 90% stock and 10% cash. The First BancTrust board instructed financial adviser D.A. Davidson & Co. to ask First Mid-Illinois to increase the consideration and continue due diligence.
First Mid-Illinois on Oct. 3, 2017, indicated that it was willing to pay 0.80 of its share and $5.00 in cash for each First BancTrust common share. As of that date, the consideration had an implied value of $36.26 per First BancTrust share and consisted of 85% shares and 15% cash. A day later, a First BancTrust special committee supported moving forward on the proposed transaction.
Comprehensive due diligence by both companies continued over several weeks. The parties exchanged the first draft of the merger deal on Nov. 9, 2017. Due diligence and negotiations continued until the deal's execution and announcement, both of which took place Dec. 11, 2017. Based on the closing price of $39.77 of First Mid-Illinois on Dec. 6, 2017, the consideration was valued at $36.82 per share.
