Ohio bank to acquire in-state peer in $70.4M deal

Dive Brief:

Sandusky, Ohio-based Civista Bancshares has agreed to buy in-state peer Spencer-based The Farmers Savings Bank in a deal valued at $70.4 million, the companies said Thursday.
After the completion of the transaction — expected to close in the fourth quarter of 2025 following regulatory and Farmers shareholders’ approvals — the combined entity will have total assets of roughly $4.4 billion, total net loans of nearly $3.2 billion, and total deposits of approximately $3.5 billion.
Civista also announced Thursday the launch of the public offering of 3,294,120 common shares at $21.25 per share, intending to raise roughly $70 million.

Dive Insight:

Civista’s recent move to raise capital, coinciding with its plan to acquire Farmers, might be aimed toward “organic growth opportunities and future strategic transactions,” the company said.

The underwriters have a 30-day option to purchase an additional 494,118 shares, according to a Securities and Exchange Commission filing Thursday. The offering is expected to close Monday, with net proceeds of roughly $65.5 million, or potentially $75.5 million if the underwriters exercise their full option, according to the filing.

The latest move will add to the nearly $4.1 billion-asset Civista’s long history of acquisitionsto establish its footprint across the Midwest. The last bank Civista bought was Communibanc Corp. and its subsidiary, The Henry County Bank, in 2022, extending its footprint in northwestern Ohio with seven branch additions.

The Farmers acquisition will add two branches in Medina and Lorain counties in northeastern Ohio to Civista’s 42-branch network across Ohio, Indiana and Kentucky.

The $285 million-asset Farmers will also bring nearly $183 million in low-cost deposits to Civista and net loans of $104 million. The acquirer plans to deploy Farmers’ excess liquidity with its 46% loan-to-deposit ratio while offering Civista’s enhanced commercial lending platform to Farmers’ markets to bolster growth.

“By combining our resources and expertise, we’re positioned to deliver greater value to our shareholders while continuing to support the individuals, families, and businesses that make Spencer, Wellington and the surrounding communities so special,” Civista CEO Dennis Shaffer said in a statement.

The transaction includes $34.925 million in cash and 1,434,491 common shares to acquire all outstanding Farmers shares. The deal value was reached based on Civista’s closing price of $24.72 per share from Wednesday.

The acquisition is expected to be accretive to Civista’s earnings per share by roughly 10% once cost savings are fully realized. Additionally, any tangible book value dilution is expected to be earned back in roughly three years after closing, bringing Civista’s capital ratio to “exceed ‘well-capitalized’ regulatory standards,” the company said.

Ohio has seen a recent surge in mergers and acquisitions. Late last month, Cincinnati-based First Financial Bancorp proposed acquiring Westfield Bancorp in a $325 million deal. In May, FSB Financial Corp.the parent company of The Farmers State Bank, headquartered in New Madison, Ohio, agreed to buy The Republic Banking Company. Both deals are expected to close by the end of this year.