Nicolet Bankshares, Inc., Green Bay, Wis., announced it will merge with County Bancorp., Manitowoc, Wis. In the $219 million deal — 80 percent stock, 20 percent cash — Nicolet National Bank, the $4.5 billion bank’s subsidiary, will acquire County Bancorp’s $1.5 billion Investors Community Bank. Based on financial records from March, the combined company will have $7.5 billion in assets, $6.3 billion in deposits, $4.9 billion in loans – all of which accounts for Nicolet’s most recent acquisition of Mackinac Financial Corporation, parent company of mBank, in April.
“One of the goals of every acquisition is to find better ways to serve communities,” said Mike Daniels, president and CEO of Nicolet. “This partnership is an intentional, strategic move to become the premier agriculture lender throughout Wisconsin.”
Investors Community Bank has developed a niche in providing financial services to agricultural businesses, particularly focused on dairy-related lending, in Wisconsin.
Founded in 2000, Nicolet currently has branches in northeast and central Wisconsin, as well as the upper peninsula of Michigan. Through the acquisition, it will expand its offerings in Manitowoc, Appleton, Green Bay, Stevens Point, Darlington, Eau Claire, Fond du Lac and Sheboygan, all in Wisconsin.
“Agricultural production lending has long been underweighted in our overall loan portfolio precisely because Investors has been so good at this core focus in agricultural lending,” said Bob Atwell, chair of Nicolet. “While some could view this as merely a market infill deal that diversifies our lending revenue, we believe it is more accurate to say this transaction better aligns our lending portfolio with the economic structure of our region.”
Under the terms of the merger, County shareholders can receive either $37.18 per common stock share, or 0.48 shares of Nicolet’s common stock. The estimated transaction value is a 1.38 multiple of County’s tangible book value. First full year earnings per share accretion is estimated in the mid-single digits and the tangible book value per share dilution of 1.2 percent is expected to be earned back in about a year and a half.
“With the added scale and capital of Nicolet, this partnership will rapidly accelerate our ability to serve existing customers and build new relationships,” said Tim Schneider, president of County Bancorp. “We remain committed to the markets and industries we serve, especially the dairy sector, and above all, keeping banking local.”
Post merger, Schneider will join the senior leadership at Nicolet as senior vice president, agriculture lending manager. A current County Bancorp board member will also join the Nicolet boards post-merger.
“We are excited about adding the expertise and specialized knowledge of the banking team from Investors, who, like our current agriculture lenders, have boots in the driveways,” Daniels said. “Long term, combining our operations will create a stronger community bank.”
Keefe, Bruyette & Woods, A Stifel Company served as financial advisor and provided a fairness opinion to the Nicolet board, and Bryan Cave Leighton Paisner LLP served as legal counsel.
Stephens Inc. served as financial advisor and provided a fairness opinion to the board of County, and Barack Ferrazzano Kirschbaum & Nagelberg LLP served as legal counsel to County.