Posted 8/18/2008 12:00 am
Updated 11 months ago
A giant banking concern intends to enter Arkansas via Texas in a stock-swap transaction estimated at $170 million.
Wells Fargo & Co. of San Francisco signed a definitive agreement to acquire Century Bancshares Inc. of Texarkana, Texas. Century, with $1.4 billion in assets, operates four banking locations in Arkansas: three in Texarkana and one in Ashdown.
"They have been looking at us without us knowing about it for some time," Joe Nichols, president and CEO of Century Bancshares, told Arkansas Business last week. "We started talking with them during the last 30 days."
The terms of the deal have not been announced, but a multiple of 1.5 times book value would put the price at about $170 million.
The bulk of Century's 485 employees and offices are in Texas, 28 branches in nine communities, with 11 of those in the Dallas area. Century Bancshares reported net income of nearly $9 million in 2007.
The roots of Century Bank date back to the 1998 acquisition of New Boston Bancshares. The deal for the then-$72 million-asset holding company was led by Truman Arnold, multi-millionaire businessman who founded and sold the Roadrunner convenience store chain. He still owns Truman Arnold Cos., a petroleum wholesaler and aviation services provider that reported $1.95 billion in revenue in the fiscal year that ended Sept. 30, 2007.
The Century Bank venture began with Arnold buying a 65 percent stake in the troubled First National Bank of New Boston, Texas. The headquarters was soon moved 25 miles east to Texarkana.
Arnold is a former First Commercial Corp. director and was the Little Rock holding company's fifth-largest shareholder when it sold to Regions Financial Corp. in 1998.
The Arkansas branches of Century Bank were launched through the purchase of the dormant First State Bank of Gurdon charter.
"Our team of employees and shareholders couldn't be more excited to be joining forces with Wells Fargo," Nichols said.
The deal is subject to regulatory approval.
Wells Fargo operates mortgage lending offices in Arkansas but has no banking presence. Arkansas would be the 24th state for the Wells Fargo franchise.
Wells Fargo has the third-largest deposit market share in the Dallas-Fort Worth market and tallied a net income of nearly $5.3 billion from its community banking operations during 2007.