Select Bancorp, Inc. (NASDAQ:SLCT), the holding company for Select Bank & Trust Company, and Premara Financial, Inc. (OTC:PARA), the holding company of Carolina Premier Bank, jointly announced today a definitive agreement for Select to acquire Premara, in a stock and cash transaction. The transaction has been unanimously approved by the Boards of Directors of each company and is expected to close in the fourth quarter of 2017, subject to the approval of federal and state regulatory agencies and the receipt of required shareholder approvals.
Carolina Premier Bank, a North Carolina chartered community bank, operates four banking offices, one in Charlotte and three in the South Carolina communities of Rock Hill, Blacksburg and Six Mile. The merger will expand Select’s presence and will allow Select to offer its product line and services to Carolina Premier’s customers. The transaction is expected to be immediately accretive to Select’s earnings per share excluding merger costs, increasing its stand-alone EPS by 10.1% beginning in 2018.
Under the terms of the merger agreement, Premara shareholders will receive merger consideration consisting of approximately 70% stock, with a fixed exchange ratio of 1.0463 shares of Select common stock for each share of Premara common stock, and 30% cash, or $12.65 for each share of Premara common stock. Premara shareholders will have an election option on the type of merger consideration that they would prefer to receive, subject to proration of such elections in accordance with the terms of the merger agreement. The transaction is currently valued at approximately $40 million based on Select’s closing price of $11.89 per share on July 20, 2017.
Select, which first opened for business in 2000, operates 13 branches in the North Carolina communities of Burlington, Clinton, Dunn, Elizabeth City, Fayetteville, Goldsboro, Greenville, Leland, Lillington, Lumberton, Morehead City, Raleigh and Washington. Select also plans to open a full-service branch in Wilmington in October 2017, pending final regulatory approval, which, with the contemplated addition of the Carolina Premier Bank branches, would bring Select’s total branch offices to 18.
“Select is extremely excited to enter the Charlotte, N.C. and northern S.C. markets through the acquisition of Carolina Premier Bank,” said William L. Hedgepeth II, president and CEO. “The acquisition of Carolina Premier Bank will move Select Bank & Trust to over $1 billion in assets and our footprint will expand west to Charlotte and into northern South Carolina. Since our founding in 2000, we have worked hard to become a high-performing community bank in eastern and central North Carolina. We have experienced and local bankers that are dedicated to delivering competitive banking products and services, as well as quality customer service, to our customers and prospective customers in the markets that we are privileged to serve. We think our success is the direct result of that dedication to the markets we serve.”
“Our success and market share in cities and towns such as Dunn, Greenville, Goldsboro and Fayetteville and other locations in North Carolina allow us to continue to expand into markets such as Raleigh, the Wilmington area, and now, Charlotte and northern South Carolina. Our focused efforts on what a community bank should be and our efficiencies allow us the opportunity for expansion. We believe this strategic acquisition will allow us to build out our Raleigh and Wilmington area markets while establishing a presence in western North Carolina and northern South Carolina. We will leverage our resources, expertise, knowledge and commitment to continue as a high-performing community bank while we continue to grow.”
Hedgepeth added, “We look forward to providing the customers and employees of Carolina Premier Bank with the resources to help them be successful. Our bank’s mission is, ‘To be the bank of choice in the communities