Virginia-based First Community Bankshares has signed an agreement to acquire local rival Highlands Bankshares and its wholly-owned subsidiary Highlands Union Bank for $91m.
Separately, First Community Bank, the banking subsidiary of First Community, signed a merger agreement with Highlands Union Bank.
The deal will merge Highlands Union Bank into First Community Bank, creating a new entity with more than $2.8bn in assets.
Highlands Bankshares acquisition: Details
Under the terms of the agreement, each share of Highlands common and preferred stock outstanding before the merger will be exchanged for 0.2703 shares of First Community common stock.
Once complete, a Highlands director will join the board of First Community Bank, as part of the deal.
With $612m in assets, Highlands offers banking services to SMEs, professionals and individuals. It has 15 offices located across North Carolina, Eastern Tennessee and Southwest Virginia.
Commenting on the transaction, Highlands Interim CEO and president Bryan Booher said: “Our customers will have access to a broader product offering and branch network while continuing to receive service that exceeds their expectations.
“Our employees will join a familiar culture and our shareholders will enjoy the benefits of being part of a high-performing $2.8bn asset franchise.”
The Highlands Bankshares acquisition is expected to close in the fourth quarter of this year. The closure is subject to fulfilment of customary closing conditions including approval from Highlands’ shareholders and regulatory green lights.