Poplar Bluff-based Southern Missouri Bancorp is acquiring Citizens Bancshares in a $140 million stock-and-cash transaction.
The merger, which is expected to close early next year, will create a $4.5 billion financial institution with 65 locations in Missouri, Arkansas, Illinois and Kansas. Southern Missouri is the parent corporation of the $3.2 billion Southern Bank. Kansas City, Mo.-based Citizens Bancshares is the parent company of the $1 billion Citizens Bank and Trust Co. Citizens operates 14 branches throughout Greater Kansas City, St. Joseph and northwest Missouri.
“[Citizens has] developed a strong deposit base and [has] a long history of serving their customers, which will be a great addition to our continued growth,” said Greg Steffens, chair and CEO of Southern Missouri Bancorp. “Additionally, a presence in Kansas City helps transform Southern Missouri into a more significant player in Missouri as we continue to build long-term shareholder value.”
Acquiring Citizens provides Southern Missouri “with immediate benefits from their excellent deposit base, and a concentration of short-duration instruments on the asset side of their balance sheet,” said Matt Funke, Southern Missouri president and chief administration officer. “Their deposit base will help us to manage our cost of funds, and the structure of their assets will help us manage our interest rate risk in this environment of rapidly changing interest rates.”
Under the agreement, Citizens’ shareholders can either elect a fixed exchange ratio of 1.448 shares of Southern Missouri common stock or a cash payment of $53.50 for each Citizens’ share.
“This merger provides an opportunity for Citizens to join forces with a growing organization, while remaining committed to community banking,” said Roger Arwood, president and CEO of Citizens Bancshares. “We look forward to the opportunities and benefits this combination will bring to our customers and communities, in terms of a larger legal lending limit and broader branch coverage across Missouri.”
Piper Sandler & Co., Minneapolis, acted as financial adviser and Silver, Freedman, Taff & Tiernan LLP, Washington, D.C., served as legal adviser to Southern Missouri. For Citizens, D.A. Davidson & Co., Great Falls, Mont., served as financial adviser and Stinson LLP, Minneapolis, served as legal adviser.