Colony Bankcorp agreed to acquire First Reliance Bancshares for about $163 million in a stock-and-cash deal, creating a combined $5 billion-asset community bank across the Southeast.
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Colony Bankcorp to buy First Reliance for $163 million in Southeast push
Colony Bankcorp Inc. agreed to acquire First Reliance Bancshares Inc. in a stock-and-cash transaction valued at about $163 million, creating a combined institution with $5 billion in assets across four Southeastern states.
"This partnership represents a truly transformational milestone for both Colony and First Reliance," said Heath Fountain, Colony's chief executive officer. "By uniting our teams, we are creating a premier Southeast banking franchise that is uniquely positioned to capture market share in some of the most dynamic economies in the country."
Under the terms, First Reliance shareholders may elect to receive either $19.75 in cash or 0.94 of a share of Colony common stock for each share they hold, subject to proration that will result in about 20% cash consideration and 80% stock. The combined lender will have roughly $4 billion in deposits and $3.2 billion in loans, with the deal expected to be immediately accretive to Colony's earnings per share excluding one-time costs.
The merger brings together Colony, a Georgia-based bank holding company with a $449 million market capitalization and locations across Georgia, Alabama, Florida and the Florida Panhandle, with First Reliance, a $1.1 billion-asset lender headquartered in Florence, South Carolina. Colony has raised its dividend for nine consecutive years and currently offers a 2.28% dividend yield, though the company reported first-quarter earnings of $0.45 per share, missing the $0.48 consensus estimate, on revenue of $39.9 million that also fell short of forecasts.
First Reliance founder and chief executive Rick Saunders will join Colony as executive vice chairman and board member. Justin Strickland, First Reliance's president, will become Colony's president for South Carolina, while chief financial officer Robert Haile will serve as chief investment officer and treasurer. First Reliance locations in South Carolina will continue operating under the First Reliance brand.
The transaction, unanimously approved by both boards, is expected to close in the fourth quarter of 2026, subject to regulatory and shareholder approvals. Keefe, Bruyette & Woods and Alston & Bird LLP advised Colony, while Hovde Group LLC and Ward and Smith PA advised First Reliance.
This article is for informational purposes only and does not constitute investment advice.
[1] Colony Bankcorp, Inc. and First Reliance Bancshares, Inc. Sign Definitive Merger Agreement to Create Transformational Southeast Banking Partnership[2] Colony Bankcorp, Inc. and First Reliance Bancshares, Inc. Sign Definitive Merger Agreement to Create Transformational Southeast Banking Partnership - Business Wire[3] Colony Bankcorp to acquire First Reliance for $163 million By Investing.com - Investing.com Canada
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