Pinnacle Financial Partners agrees to acquire BNC Bancorp in $1.9B bank merger (2024)

Pinnacle Financial Partners Inc., the holding company and parent of Pinnacle Bank, and BNC Bancorp, the holding company and parent of Bank of North Carolina, jointly announced a definitive agreement through which BNC will merge into Pinnacle in an all-stock transaction estimated at $1.9 billion.

Upon completion of the merger, Pinnacle will merge Bank of North Carolina into Pinnacle Bank.

The merger will create a four-state footprint concentrated in 12 of the largest urban markets in the Southeast, adding significant presence in Greenville-Spartanburg, Charleston, Charlotte, Raleigh, Greensboro, and Winston-Salem to Pinnacle’s Tennessee franchise. On a pro forma basis, Pinnacle is expected to be a top 50 public U.S. banking franchise by assets, with $20 billion in assets, $14 billion in loans and $15 billion in deposits.

Pinnacle will operate the Carolinas and Virginia region out of BNC’s existing corporate headquarters in High Point, N.C.

In 2015, BNC said it would acquire several CertusBank branches in Greenville and elsewhere in the Upstate as Certus sold or closed its remaining operations.

Richard D. “Rick” Callicutt II, BNC’s president and chief executive officer, will be named chairman of the Carolinas and Virginia region and join Pinnacle’s board along with three other BNC directors. David B. Spencer, BNC’s senior executive vice president and chief financial officer, will be named executive vice president supporting Callicutt in growing the firm’s presence in the Carolinas and Virginia and working in the combined company’s treasury and corporate finance areas.

“BNC represents the single best platform to expand our presence in urban, high-growth metropolitan markets,” Pinnacle President and CEO M. Terry Turner said. “This merger is consistent with Pinnacle’s strategy to become the dominant bank in Southeastern commercial banking. BNC’s success can be attributed to its experienced financial services professionals and the culture they have created. I have admired Rick’s leadership and the significant growth he and the entire BNC team have achieved. I am very excited that we will be on the same team.”

Under the terms of the merger agreement, BNC shareholders will receive 0.5235 shares of Pinnacle common stock for every BNC share. All fractional shares will be cashed out as of the closing. Additionally, BNC’s outstanding stock options will be fully vested upon consummation of the merger, and all outstanding BNC options that are unexercised prior to the closing will be cashed out based on Pinnacle’s 10 trading-day average closing price ending on the trading day immediately preceding the closing date.

Based on Pinnacle’s 20-day trailing average closing price as of Jan. 20, the transaction is valued at approximately $35.70 per share, or $1.9 billion.

“Both we and Pinnacle have been committed to the idea that the Southeast deserves an impactful financial services firm with significant scale that operates with the culture of a community bank with local decision making led by banking professionals that are experienced and established in each market,” Callicutt said. “Bringing two of the Southeast’s best community banks together is a great thing for the region. By joining firms, Pinnacle and BNC can leverage each other’s competitive strengths and offer clients a broader array of superior banking services.”

The proposed merger has been approved unanimously by each company’s board of directors and is expected to close in the third quarter of 2017. The merger is subject to customary closing conditions, including required regulatory approvals and the approval of both Pinnacle and BNC shareholders.

Pinnacle anticipates the transaction, with cost savings fully phased in and other adjustments, to be accretive to its 2018 earnings per share by approximately 10 percent, excluding acquisition-related and integration costs associated with the transaction.