JASPER, Ind. — German American Bancorp, Inc. has announced that it has completed its previously announced acquisition of First Security, Inc., the parent company of First Security Bank, Inc. of Owensboro, Ky., effective as of Oct. 15, 2018.
Immediately following the merger of First Security, Inc. into German American Bancorp, Inc., First Security Bank, Inc. merged with and into German American’s banking subsidiary, German American Bank.
First Security’s common shareholders of record on Oct. 15, 2018 will be entitled to receive 0.7982 shares of German American common stock and a cash payment of $12.00 for each of their former shares of First Security common stock, subject to their surrender of the old First Security shares to the exchange agent designated by German American. Instructions and forms to accomplish that surrender and exchange process are being mailed by the exchange agent to each of First Security’s shareholders of record as of October 15, 2018.
“We are pleased the merger received the overwhelming approval of the First Security shareholders and are delighted to welcome First Security’s customers, employees and shareholders to German American,” said Mark A. Schroeder, chairman and CEO of German American. “This merger with First Security represents a strategic opportunity for German American to expand our community-focused, customer-centric business model into the vibrant Kentucky metropolitan markets of Owensboro, Bowling Green, and Lexington. First Security has built a solid community banking franchise in these three distinct Kentucky markets in which German American can provide our extensive offerings of banking, insurance, and investment products and services to First Security’s current and prospective clients.
The combination of our two organizations provides an important entrance for German American into three of the largest Kentucky metropolitan market areas, and enhances German American’s existing presence in the Evansville, Indiana metropolitan market area, which is the third largest metropolitan market in Indiana and where we currently hold a significant and growing market share. We’re extremely excited about the multiple future organic growth opportunities this merger will afford our Company.”
“We expect that this strategic transaction will be accretive to German American’s earnings per share during the 12 months following completion of the transaction, and will have a quick tangible book value earn back,” Schroeder said. “Following completion of the merger, German American’s pro forma capital ratios will continue to significantly exceed regulatory well-capitalized levels, enabling us to continue to take advantage of future organic and acquisition growth opportunities in Kentucky and throughout our existing Southern Indiana market area.”
Michael F. Beckwith, president & CEO of First Security, will continue to lead German American’s operations in their new Kentucky market area in the newly established role of Kentucky Divisional president. Additionally, Lee A. Mitchell, First Security’s Board chairman, will be joining the Board of German American Bancorp, Inc. shortly following the merger.
“This partnership with German American will enable us to deepen and broaden the financial services we provide in all of our markets, and will provide great opportunity for both our customers and employees,” Beckwith said. “Strategically and culturally, we are well aligned with German American, and through this partnership, German American is gaining a meaningful presence in Kentucky.
From a shareholder perspective, German American is one the nation’s best-performing community banking organizations, and their NASDAQ listed stock provides our shareholders with enhanced liquidity and trading volume. German American’s reputation, financial strength and capabilities will provide tremendous value to our customers, employees, communities and shareholders.”
Sandler O’Neill & Partners, L.P. served as financial advisor on the transaction to German American and Bingham Greenebaum Doll LLP served as legal counsel.
Raymond James & Associates, Inc. served as financial advisor on the transaction to First Security, Inc. and Frost Brown Todd LLC served as legal advisor.
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