MVB Financial, the holding company for MVB Bank, entered into a definitive merger agreement pursuant to which MVB will acquire Integrated Financial Holdings (IFH) in an all-stock transaction. The strategic combination is expected to accelerate a fast track growth vehicle for MVB by expanding its government guaranteed lending business, including SBA and USDA originations and servicing.
IFH is headquartered in Raleigh, NC, and is the parent company of five wholly owned subsidiaries, including West Town Bank & Trust (WTBT) and Windsor Advantage. WTBT had approximately $435 million in total assets, $326 million in loans and $334 million in deposits as of June 30, 2022. Since 2018, WTBT’s government guaranteed lending team has originated more than $1 billion in loans. Windsor is a national lending service provider, offering financial institutions a comprehensive outsourced SBA and USDA lending platform, servicing approximately $2.1 billion in loans.
Under the terms of the merger agreement, IFH shareholders will receive 1.21 shares of MVB common stock for each share of IFH common stock. Based on the closing price of MVB stock of $34.54 on Aug. 11, the implied per share purchase price is $41.79, with an aggregate transaction value of approximately $98 million.
The transaction is expected to be immediately accretive to tangible book value per share at closing and approximately 15% accretive to earnings per share in 2023. MVB also expects tangible common equity to tangible assets and all regulatory capital ratios to increase pro forma for the transaction.
“MVB continues to focus on key growth initiatives as part of our MVB-F1: Success Loves Speed strategic plan. Even in wet track market conditions, MVB continues to be opportunistic and look for deals that make sense to our business model. This acquisition accelerates both our SBA and strategic lending partnerships growth vehicles to the benefit of our clients and shareholders. Both strong companies on our own, together we become a national leader in government guaranteed lending, specifically SBA and USDA lending,” Larry F. Mazza, CEO of MVB Financial, said. “We believe we have an excellent cultural fit and outstanding additions of talent with Eric Bergevin, Riddick Skinner and Mike Breckheimer joining Team MVB.”
Upon closing of the transaction, IFH President and CEO Eric Bergevin will join MVB’s executive leadership team as a direct report to CEO Larry F. Mazza. Riddick Skinner, EVP, government lending for IFH and Michael Breckheimer, EVP, corporate strategy for IFH, will report to Bergevin.
“We are excited to embark on this strategic alliance with MVB to create what we believe will be an industry-leading juggernaut in government guaranteed lending,” Bergevin said. “The merger represents two organizations with shared entrepreneurial-minded philosophies around the idea of synergy.”
The transaction with IFH has been unanimously approved by both IFH’s and MVB’s boards of directors and is expected to be completed in the first quarter of 2023, subject to approval of both companies’ shareholders, regulatory approvals and the satisfaction of other customary closing conditions.
Stephens served as financial advisor and Squire Patton Boggs served as legal advisor to MVB. Raymond James & Associates served as financial advisor and Wyrick Robbins Yates & Ponton served as legal advisor to IFH.