First Horizon National Corp. of Memphis officially crossed the Mississippi River and entered Arkansas on July 2 with the completion of its $2.3 billion stock swap purchase of IberiaBank Corp. of Lafayette, Louisiana.
The value of the transaction represented a 3.4% premium based on IberiaBank’s final closing price of $43.08 per share on July 1 and First Horizon’s opening price of $9.72 per share the next day. The deal featured a stock swap multiple of 4.584 shares of First Horizon for each of IberiaBank’s 52,618,287 shares outstanding as of March 31.
Touted as the largest bank deal to close in 2020, the transaction was valued at $3.9 billion back when First Horizon’s stock was trading at $16.31 per share on Nov. 1. IberiaBank’s stock was trading at $76.83 per share at the time.
At last count, IberiaBank held $1.1 billion deposits in Arkansas, the 11th-largest share (1.57%) of state bank deposits.
Jay Meador, IberiaBank’s central Arkansas market president, remains at his post with First Horizon. Meador doesn’t expect new ownership to result in staff reductions in Arkansas.
“Initially, there won’t be a ton of change,” he said. “The signage and name change will probably be midyear next year.”
IberiaBank’s 16-branch Arkansas network was distributed across three regions: central, six; northeast, six; and northwest, four.
According to securities filings, conceptual discussion regarding the possibility of a First Horizon-IberiaBank merger dates back to 2016 when First Horizon was known as First Tennessee.
But those informal talks between Bryan Jordan, chairman, president and CEO of First Horizon, and Daryl Byrd, president and CEO of IberiaBank, didn’t get serious until July 2019.
That courting was an outgrowth of IberiaBank scouting potential buyers and sellers who might be interested in a merger. Among the considerations for accelerated growth through acquisition or sale was the increasing need for scale and technology investments in the banking industry.
The IberiaBank deal wasn’t First Horizon’s opening move west of the Mississippi. The now $79 billion-asset bank opened a Texas office in Houston in April 2016.
The First Horizon-IberiaBank combination, a marriage of two 100-plus-year-old lenders, creates the 33rd-largest bank in the nation ranked by total assets.