[November 23, 2016] |
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Kroll Bond Rating Agency Releases Research Report "Comments on Independent Bank Group, Inc.'s Acquisition of Carlile Bancshares, Inc."
Kroll Bond Rating Agency (KBRA) comments on Independent Bank Group,
Inc.'s Acquisition of Carlile Bancshares, Inc.
The report makes the following key points:
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Independent Bank Group, Inc. (NASDAQ: IBTX), (IBTX or "the
Company"), headquartered in McKinney, Texas, announced the signing of
a definitive agreement to acquire Forth Worth, Texas based Carlile
Bancshares, Inc. ("Carlile), the holding company and parent of
Northstar Bank of Texas (FSR: B-). Based on financials as of September
30, 2016, IBTX will have approximately $8.0 billion in total assets
after the completion of the deal.
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Carlile's shareholders will receive 8.9 million shares of IBTX stock,
based on a negotiated IBTX stock price of $47.40 per share. Carlile's
option holders will receive a cash payment in the amount of
approximately $13.7 million. The deal is anticipated to close in the
second quarter of 2017 and has an aggregate value of $434 million. The
transaction has a price to tangible book value (P/TBV) of 2.13x and a
projected cost savings of 35%.
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KBRA expects that the transaction will result in moderately improved
financial condition for IBTX. Pro forma regulatory capital ratios are
anticipated to be moderately stronger post acquisition given that the
consideration is 100% common stock, in conjunction with the additional
issuance of common stock to support growth and cash payment to the
acquired institution's option holders.
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The acquisition will allow the Company to enter key metropolitan
mrkets in Colorado and expand IBTX's presence in the Dallas-Fort
Worth metropolitan statistical area (MSA).
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KBRA acknowledges that there are risks related to the expansion into
new markets and system integration given the size of the acquired
institution. The aforementioned risks are partially mitigated by the
retention of key directors and personnel of the acquired institution
and IBTX's solid track record of successful acquisitions.
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In August 2016, KBRA affirmed the senior unsecured debt rating of BBB,
subordinated debt rating of BBB- and short-term rating of K3 for
Independent Bank Group, Inc. KBRA also affirmed the BBB+ deposit and
senior unsecured debt ratings and the K2 short-term deposit and debt
ratings for the lead subsidiary, Independent Bank. Additionally, a
subordinated debt rating of BBB was assigned to the Bank. The outlook
on all long-term ratings is stable.
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In the short-term, KBRA believes the acquisition of Carlile
Bancshares, Inc. will be neutral to the ratings of IBTX. The
transaction may represent a mid-term or long-term net positive over
time as it further extends IBTX's operations into economically vibrant
and attractive metro markets.
The ratings are based on KBRA's Global
Bank and Bank Holding Company Rating Methodology published on
February 19, 2016.
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About Kroll Bond Rating Agency
KBRA is registered with the U.S. Securities and Exchange Commission as a
Nationally Recognized Statistical Rating Organization (NRSRO). In
addition, KBRA is recognized by the National Association of Insurance
Commissioners (NAIC) as a Credit Rating Provider (CRP).
View source version on businesswire.com: http://www.businesswire.com/news/home/20161123005564/en/
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