Poplar Bluff, Mo.-based Southern Missouri Bancorp Inc. has agreed to buy Rolla, Mo.-based Central Federal Bancshares Inc. for about $24.0 million in cash.
The deal value is inclusive of the retirement of debt outstanding under Central Federal Bancshares' employee stock ownership plan. Under the terms of the deal, Central Federal Bancshares shareholders will receive $15.90 in cash for each common share they own, subject to adjustment for the company's capital at the time the deal is closed.
Central Federal Savings and Loan Association of Rolla will be merged into Southern Bank as part of the deal. The deal is expected to close late in the second quarter.
S&P Global Market Intelligence valuations for bank and thrift targets in the Midwest region between Jan. 17, 2019, and Jan. 17, 2020, averaged 138.63% of book and 144.19% of tangible book and had a median of 16.04x last-12-months earnings, on an aggregate basis.
S&P Global Market Intelligence calculates the deal value is 89.3% of common equity and 89.3% of tangible common equity, on an aggregate basis. The deal value is 30.38% of assets, 46.34% of deposits and tangible book discount to core deposits is 6.63%.
Central Federal Bancshares' consolidated assets as of Sept. 30, 2019, were $69 million, including loans of $53 million, net of allowance, while deposits amounted to $46 million. Southern Missouri Bancorp reported consolidated assets of about $2.3 billion, including net loans of $1.9 billion, and total deposits of $1.9 billion as of Sept. 30, 2019.
The deal will enable Southern Missouri Bancorp to enter Phelps County, Mo., with one branch to be ranked seventh with a 5.15% share of approximately $928.1 million in total market deposits.
Lewis Rice LLC served as legal adviser to Central Federal Bancshares, while Silver Freedman Taff & Tiernan LLP served as legal adviser to Southern Missouri Bancorp. Keefe Bruyette & Woods served as financial adviser to Central Federal Bancshares.