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Alabama-based River Financial to acquire Trinity Bancorp in $27M deal

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Alabama-based River Financial to acquire Trinity Bancorp in $27M deal

Prattville, Ala.-based River Financial Corp. agreed to acquire Dothan, Ala.-based Trinity Bancorp Inc. in a cash-and-stock deal valued at roughly $27.1 million.

Each Trinity Bancorp common share will be converted into the right to receive $3.50 in cash and 0.44627 of a River Financial common share. Also under the deal, Trinity Bank will merge into River Bank & Trust.

The deal is expected to close in the fourth quarter. Trinity Bancorp will pay a termination fee of $810,000 to River Financial if it terminates the deal in favor of another proposal, among other circumstances.

River Financial had total assets of $1.09 billion as of March 31, and Trinity Bancorp had total consolidated assets of $152.3 million as of Dec. 31, 2018, according to S&P Global Market Intelligence data. The combined company will have more than $1.28 billion in total assets, $875 million in total loans and $1 billion in total deposits. It will also have 17 locations across Alabama, according to a release.

Trinity Bancorp director Brian McLeod will join River Financial's board. Trinity Bank director Robbin Thompson will join River Bank & Trust's board and serve as president of the Wiregrass region.

Following the merger, Trinity Bank branches in Dothan and Enterprise, Ala., will operate as River Bank & Trust branches.

S&P Global Market Intelligence calculates the deal is 184.4% of each of common equity and tangible common equity and 12.9x earnings, on an aggregate basis. The deal value is 17.35% of assets, 19.64% of deposits and it has a tangible book premium-to-core deposits ratio of 12.35%.

S&P Global Market Intelligence valuations for bank and thrift targets in the Southeast region between June 4, 2018, and June 4, 2019, averaged 166.66% of book and 177.21% of tangible book and had a median of 21.42x last-12-months earnings, on an aggregate basis.

River Financial Corp. will enter Houston County, Ala. with two branches, which will be ranked no. 11 with a 2.78% share of approximately $2.64 billion in total market deposits. It will also enter Coffee County, Ala. with one branch, which will be ranked sixth with a 9.74% share of approximately $635.92 million in total market deposits.

Porter White Capital LLC served as Trinity Bancorp's financial adviser, while Jones Day served as legal counsel. Jones Walker LLP was River Financial's legal counsel in the deal. Sheshunoff & Co. provided a fairness opinion to River Financial.

To use S&P Global Market Intelligence's branch analytics tools to compare market overlap, click here. To create custom maps, click here.

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