Pinnacle Bankshares and Virginia Bank Bancshares signed a definitive agreement to combine in a strategic merger.
The combined company would have approximately $703 million in total assets, $624 million in total deposits, and $537 million in loans based upon reported amounts as of September 30, 2019.
The merger agreement was approved by the boards of directors of both companies and has unanimous support from all directors. Under the terms of the agreement, Virginia Bank shareholders will have the opportunity to elect to receive either $16.00 of cash or 0.5000 shares of Pinnacle common stock for each share of Virginia Bank common stock held, subject to the limitation that 70% of the shares will be exchanged for the Stock Consideration and 30% of the shares will be exchanged for the Cash Consideration.
After the merger of Virginia Bank into Pinnacle, Pinnacle shareholders will own 71% of the combined company, and Virginia Bank shareholders will own approximately 29%.
The merger creates a larger and stronger institution with a significantly higher lending limit, expanded product offering and access to new markets. Both management teams anticipate that such enhanced scale and efficiency will create meaningful opportunities to drive further growth, profitability and long-term value creation for employees, customers and shareholders.
“This is a tremendous opportunity to combine two neighboring community banks with similar cultures and philosophies in a transformational merger,” said Aubrey H. “Todd” Hall, III, Pinnacle president and chief executive officer.
Donald W. Merricks, chairman and chief executive officer of Virginia Bank, said, “We believe that Pinnacle is the ideal partner for our bank. Merging these financially sound institutions is a natural fit. Both banks are led by seasoned teams of community bankers who make local decisions to serve the communities in which we operate. This merger will allow us to better provide quality banking services to our customers, a rewarding workplace for our employees, and superior value to our shareholders.”
Upon consummation of the transaction, Pinnacle will be the surviving holding company. Virginia Bank and Trust Company will merge into First National Bank and First National Bank will be the surviving bank. Offices of Virginia Bank and Trust Company will be rebranded as First National Bank offices as systems are integrated. No office closures are expected as a result of the merger.
Pinnacle Bankshares is a locally managed community banking organization based in Central Virginia.
Virginia Bank Bancshares is the bank holding company for Virginia Bank and Trust Company.
