Meta Financial Group in Sioux Falls, S.D., has agreed to buy Crestmark Bancorp in Troy, Mich.
The $5.2 billion-asset Meta said in a press release Tuesday that it will pay $321 million in stock for the $1.2 billion-asset parent of Crestmark Bank. The deal is expected to close in the second quarter.
Meta said the acquisition provides it with a nationwide commercial lending platform. Crestmark offers asset-based loans, equipment finance leases and government-guaranteed loans to small and midsize businesses.
The deal is expected to be immediately accretive to Meta’s 2018 earnings per share and 10% accretive the next year, excluding merger-related costs. It should take about two years to earn back the expected 8% dilution to Meta’s tangible book value.
Meta said it expects to incur about $18 million in pretax expenses tied to the acquisition. It plans to cut about 6% of Crestmark's annual noninterest expenses.
“With this acquisition, we continue to deliver on our goal of growth and innovation through diversification,” J. Tyler Haahr, Meta’s chairman and CEO, said in the release. “This transformational transaction will allow us to significantly add on-balance sheet loans at attractive yields. … It also creates complementary cross-sell opportunities for our insurance premium finance business.”
Mick Goik, Crestmark’s president and chief operating officer, will become an executive vice president at Meta and president of the Crestmark division. W. David Tull, Crestmark’s chairman and CEO, and another director will join Meta’s board.
Raymond James and Katten Muchin Rosenman advised Meta. Sandler O’Neill and Dickinson Wright advised Crestmark.