Two of the Best Banks in America Join Forces in Bank Merger

The parent company of HemeBancShares, Inc. and Stonegate Bank (headquartered in Pompano, Florida) promulgated a unison for Home to procure Stonegate.

Home BancShares, Inc. (NASDAQ:HOMB) (“Home” or the “Company”), parent company of Centennial Bank, (“Centennial”), and Stonegate Bank (NASDAQ:SGBK) (“Stonegate”), headquartered in Pompano Beach, Florida, today announced the signing of a definitive agreement and plan of merger for Home to acquire Stonegate. Under the terms of the agreement, Stonegate will merge into Centennial and shareholders of Stonegate will receive proceeds from the transaction of approximately $749.8 million, consisting of approximately $50.0 million in cash and approximately $699.8 million of Home common stock.  In addition, the holders of outstanding stock options of Stonegate will receive approximately $28.6 million in cash in cancellation of their options immediately before the merger, for a total transaction value of approximately $778.4 million.

Stonegate currently operates 25 branch locations in key Florida markets with significant presence in Broward and Sarasota counties.  As of December 31, 2016, Stonegate had approximately $3.1 billion in total assets, $2.5 billion in total loans, and $2.7 billion in deposits.¹  Upon completion of the acquisition, the Company will have approximately $13.5 billion in total assets.²

Home and Stonegate were both recently awarded a 2016 Raymond James Community Bankers Cup award.  The Raymond James Community Bankers Cup awards recognized the top 28 community banks with assets between $500 million and $10 billion based on various profitability, operational efficiency, and balance sheet metrics. In addition, Forbes recently named Home as the 8th best bank in America among banks with assets from $8 billion to $2.5 trillion.

“The acquisition of Stonegate is a game-changer for Home in the Florida market. Stonegate is a top tier franchise with high profitability and has the perfect footprint to enhance Home’s presence in Florida,” said John Allison, Home’s Chairman.  “This is another ‘Triple A’ transaction for Home:  accretive to earnings per share, accretive to book value and accretive to tangible book value.  Our shareholders will benefit on day one as we will be stronger together.  Dave Seleski, Stonegate’s CEO, leads a terrific team of bankers and we all look forward to welcoming them to Home.”

“We are excited to join Home BancShares and Centennial Bank,” said Dave Seleski, Stonegate’s Chief Executive Officer.  “Home and Stonegate are two very high performing franchises with a similar operating philosophy and customer focus. This is a great combination for our shareholders, customers and communities.”

“I have known and admired Dave Seleski and Stonegate for a long time. This transaction is the perfect fit for our Florida operation and is financially attractive to both parties,” said Tracy French, Centennial’s Chief Executive Officer.  “More importantly, the organizational values of Stonegate, and its people, align very well with those of Home and we are all committed to providing Stonegate’s customers with the highest quality customer service that Centennial customers are accustomed to.”

The acquisition is expected to close in the fourth quarter of 2017 and is subject to Home and Stonegate shareholder approval, regulatory approval, and other conditions set forth in the merger agreement.