Beloit, Wis.-based Blackhawk Bancorp Inc. signed a definitive merger agreement with McHenry, Ill.-based First McHenry Corp. to acquire all of the common shares of First McHenry for approximately $23.0 million in aggregate cash consideration.

The deal is expected to close in the first quarter of 2019.

On an aggregate basis, SNL calculates that the deal value is 154.1% of book, 155.1% of tangible book and 25.0x earnings. It is also 13.10% of assets, 14.33% of deposits and the tangible book premium-to-core deposits ratio is 5.41%.

For comparison, SNL valuations for bank and thrift targets in the Midwest region between Oct. 18, 2017, and Oct. 18, 2018, averaged 157.97% of book, 164.64% of tangible book and had a median of 22.94x last-12-months earnings, on an aggregate basis.

First McHenry is the parent of First National Bank of McHenry, which had approximately $175 million in assets, $45 million in loans and $160 million in deposits at June 30, according to the merger release. According to SNL data, Blackhawk Bancorp had $772.4 million in assets as of Sept. 30.

Blackhawk Bancorp will enter McHenry County, Ill., with two branches to be ranked No. 16 with a 1.92% share of approximately $6.81 billion in total market deposits. It will also enter Lake County, Ill., with one branch to be ranked No. 29 with a 0.14% share of approximately $20.72 billion in total market deposits.

Performance Trust Capital Partners LLC is serving as financial adviser to Blackhawk Bancorp, and Howard & Howard Attorneys is serving as its legal adviser. Olsen Palmer LLC is serving as financial adviser to First McHenry, and Godfrey & Kahn is serving as its legal adviser.

SNL is owned by S&P Global Market Intelligence.

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