Pinnacle Financial Partners To Buy BNC Bancorp

(RTTNews) - Pinnacle Financial Partners, Inc. (PNFP), the holding company and parent of Pinnacle Bank, and BNC Bancorp (BNCN), the holding company and parent of Bank of North Carolina, announced the signing of a definitive agreement by which BNC will merge with and into Pinnacle in an all-stock transaction. Upon completion of the merger, Pinnacle will merge Bank of North Carolina with and into Pinnacle Bank. The transaction is valued at approximately $35.70 per share, or $1.9 billion in the aggregate

Pinnacle will operate the Carolinas and Virginia region out of BNC's existing corporate headquarters in High Point, North Carolina.

Richard D. "Rick" Callicutt II, BNC's President and Chief Executive Officer, will be named Chairman of the Carolinas and Virginia region once the acquisition is consummated and will join Pinnacle's board along with three other BNC directors.

David 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.

As per 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 ten 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 Friday, January 20, 2017, the transaction is valued at approximately $35.70 per share, or $1.9 billion in the aggregate. Based on Pinnacle's most recent dividend, BNC shareholders will receive an approximate 47 percent increase to their current $0.05 quarterly dividend per share upon completion of the transaction.

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 the receipt of 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 about 10 percent, excluding acquisition-related and integration costs associated with the transaction. Pinnacle also estimates that the transaction will be accretive to tangible book value including all acquisition-related and integration costs associated with the transaction.

Separately, BNC Bancorp reported that its net income for the fourth-quarter of 2016 $15.7 million, or $0.31 per share, compared to $18.1 million, or $0.38 per diluted share, for third quarter of 2016.

Operating net income for the fourth-quarter was $21.8 million, or $0.43 per share, compared to $19.7 million, or $0.42 per share, for third quarter of 2016.