BATON ROUGE, La.--(BUSINESS WIRE)--Business First Bancshares, Inc., the parent bank holding company of Business First Bank (collectively referred to as “Business First”), and American Gateway Financial Corporation, the parent bank holding company of American Gateway Bank (collectively referred to as “American Gateway”), both headquartered in the Baton Rouge area, jointly announced today that they have signed a definitive agreement providing for the merger of these institutions. Under the terms of the definitive agreement, American Gateway Financial Corporation will be merged with and into Business First Bancshares, Inc., followed by the merger of American Gateway Bank with and into Business First Bank. Following these transactions, the combined institution will continue to operate under the Business First brand.
“We have worked hard to build a reputation as Louisiana’s best business bank, for both our clients and for bankers eager to put their skills and experience to work making a difference for those clients,” said Jude Melville, president and CEO of Business First Bank. “While we continue to focus on serving our growing roster of entrepreneurs and business owners, this partnership is the next step – a foundational step – toward our larger goal of being not only Louisiana’s best business bank, but also the state’s most impactful community bank.”
The transaction is expected to significantly expand both institutions’ greater Baton Rouge coverage, with a resulting deposit base of roughly twice each bank’s stand-alone volume in the Capital Region. American Gateway has 10 Baton Rouge-area banking centers: five in East Baton Rouge Parish, three in West Baton Rouge Parish, and one each in Livingston and Ascension parishes, all part of metropolitan Baton Rouge. Business First currently has one banking center in each of the following Louisiana markets: Baton Rouge, Shreveport/Bossier City, Lake Charles, Lafayette and Covington. The bank also has a loan production office in Houma. The merged institution is expected to be the largest community bank headquartered in Baton Rouge as measured by deposits and one of only a handful of community banks with statewide coverage. The combined company will operate 16 locations with over $1 billion in assets, $870 million in deposits, $700 million in loans and $100 million in equity.
“We see a lot of synergies for our clients and employees in this partnership,” said Don Ayres, president and CEO of American Gateway Bank. “Banking convenience will be enhanced with the addition of five new markets. Our balance sheet will be larger and more diversified, and clients will have access to a broader platform of business banking products and services and commercial bankers who have been the cornerstone of Business First’s success. We also have much to add to the Business First franchise, including diversification, talented employees and an established branch network that will immediately offer current clients more convenience. We’re very proud of our 106-year legacy and feel that Business First is the right partner with which to carry on that tradition of locally-focused, community-oriented service.”
Business First and American Gateway plan to close the transaction during the fourth quarter of 2014. The transaction is subject to certain conditions, including approval by the shareholders of American Gateway Financial Corporation and customary regulatory approvals. The shares of Business First common stock to be issued to the shareholders of American Gateway in this transaction will be registered with the Securities and Exchange Commission (“SEC”). Business First and American Gateway intend to file relevant materials with the SEC, including a Registration Statement on Form S-4 that will contain a proxy statement of American Gateway and a prospectus of Business First relating to the shares of its common stock that are to be registered and issued in connection with the proposed merger. Consummation of the merger will be subject to the SEC’s declaration that the Registration Statement is effective.
“Louisiana is on the verge of an economic renaissance, and the Louisiana community banking industry is in a period of evolution,” Melville added. “Our combined local depth and statewide breadth uniquely position us to make a meaningful contribution to both of those developments. Together we have an opportunity to make a difference – for our investors, for our employees and for our community.”
Commerce Street Capital, LLC, acted as exclusive financial advisor and Fenimore, Kay, Harrison & Ford, LLP, acted as exclusive legal advisor to Business First Bancshares, Inc. in this transaction. Sandler, O’Neill + Partners acted as exclusive financial advisor and Kantrow, Spaht, Weaver & Blitzer (APLC) acted as exclusive legal advisor to American Gateway Financial Corp. National Capital, LLC, and Sandler, O’Neill + Partners delivered fairness opinions to American Gateway Corporation.
Forward-Looking Statements
Certain statements contained in this news release may not be based on historical facts and are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as "anticipate," "believe," "estimate," "expect," "may," "might," "will," "would," "could" or "intend." These forward-looking statements include, without limitation, statements relating to the terms and closing of the proposed transaction with American Gateway, acceptance by customers of American Gateway of Business First's products and services, the opportunities to enhance market share in certain markets and market acceptance of Business First generally in new markets.
We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors. These factors include, but are not limited to, the ability to obtain required shareholder and regulatory approvals for the merger, the ability of Business First and American Gateway to close the merger, Business First's ability to successfully integrate the operations of American Gateway after the merger, the ability of Business First to provide competitive services and products in new markets and grow market share in existing markets, the ability of Business First to assimilate and retain key personnel after the merger, conditions in the financial markets and economic conditions generally, the adequacy of Business First's provision and allowance for credit losses to cover actual credit losses, the credit risk associated with real estate construction, acquisition and development loans, losses resulting from the significant amount of Business First's other real estate owned, limitations on Business First's ability to declare and pay dividends, the impact of legal or administrative proceedings, the availability of capital on favorable terms if and when needed, liquidity risk, governmental regulation and supervision of Business First's operations, the short-term and long-term impact of changes to banking capital standards on Business First's regulatory capital and liquidity, the impact of regulations on service charges on Business First's core deposit accounts, the susceptibility of Business First's business to local economic or environmental conditions, the soundness of other financial institutions, changes in interest rates, the impact of monetary policies and economic factors on Business First's ability to attract deposits or make loans, volatility in capital and credit markets, reputational risk, the impact of hurricanes or other adverse weather events, any requirement that Business First write down goodwill or other intangible assets, diversification in the types of financial services Business First offers, Business First's ability to adapt its products and services to evolving industry standards and consumer preferences, competition with other financial services companies, Business First's growth strategy, interruptions or breaches in Business First's information system security, the failure of certain third party vendors to perform, unfavorable ratings by rating agencies, dilution caused by Business First's issuance of additional shares of its common stock to raise capital or acquire other banks, bank holding companies, financial holding companies and insurance agencies, other factors generally understood to affect the financial condition or results of financial services companies and other factors detailed from time to time in Business First's press releases and filings with the Securities and Exchange Commission. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.
