Magazine article American Banker

A 3-Year M&A Break Ends with A2-Deal Day

Magazine article American Banker

A 3-Year M&A Break Ends with A2-Deal Day

Article excerpt

BancorpSouth Inc.'s nearly 3-year hiatus from bank acquisitions officially ended Friday, when the Tupelo, Miss., company struck a pair of deals that would move it into the fast-growing markets of Baton Rouge, La., and Nashville.

The $10.7 billion-asset company said it is buying the $164 million-asset Business Holding Co. in Baton Rouge and the $151 million-asset Premier Bancorp in Brentwood, Tenn. -- its first bank deals since February 2002.

Chairman and chief executive Aubrey B. Patterson did not disclose the price of either deal but said they would dilute earnings by 2 cents a share in 2005. The dilution will be temporary, he said, and he expects the companies to add significantly to earnings long-term.

"That's the theme," Mr. Patterson said Friday. "This is an investment. There will be a minute amount of dilution in the immediate short term, but tremendous growth potential."

BancorpSouth was an active acquirer from 1997 to 2002, buying eight banks in Mississippi, Alabama, and Arkansas. In recent years it has concentrated on beefing up its fee income business, buying an insurance agency and two investment firms.

Mr. Patterson said BancorpSouth has been looking for a bank deal in Baton Rouge since May 2003, when it paid $18.2 million for Wright & Percy Insurance, which is headquartered there. The agency is the largest in Louisiana.

"Having a connection to Wright & Percy will be a big benefit to the Business Bank of Baton Rouge, and vice versa," Mr. Patterson said, referring to Business Holding's bank subsidiary. "They'll play mutually supportive roles."

Charles "Buddy" Roemer 3d, Business Bank's president and Louisiana's governor from 1988 to 1992, would head BancorpSouth's operation in Baton Rouge, Mr. Patterson said.

Mr. Roemer said Friday that BancorpSouth's deeper pockets would help his team expand its business-focused approach throughout Louisiana and into Texas. …

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