Wintrust Completes Acquisition of Macatawa for $510.3M

Wintrust Financial Corporation WTFC has closed the all-stock deal to acquire Macatawa Bank Corporation for $510.3 million or $14.85 per share. The merger agreement, which is not expected to have a material effect on Wintrust's 2024 earnings, was signed this April.

Headquartered in Holland, MI, Macatawa operates a network of 26 full-service branches located throughout communities in Kent, Ottawa and northern Allegan counties, including Grand Rapids.

As of Jun 30, 2024, Macatawa Bank had $2.7 billion in assets, $2.3 billion in deposits and $1.3 billion in loans. Its approach to customer service is similar to that at each of the fifteen other Wintrust Community Banks and their more than 170 banking locations.

Per the terms of the deal, at the time of the merger, each of Macatawa's 34,361,562 common shares outstanding were to be converted into the right to receive merger consideration paid in shares of Wintrust common stock.

Accordingly, each of Macatawa's common shares outstanding was converted into the right to receive 0.137 shares of Wintrust common stock, with cash paid in lieu of fractional shares.

Timothy S. Crane, the president and CEO of Wintrust, stated, "Macatawa Bank provides an ideal platform to expand into West Michigan with a very solid bank. The bank has a strong core deposit base, exceptional asset quality, a client focused culture, and a committed leadership team. Together, we will be a formidable, community-minded competitor to the other banks in the area. We look forward to providing Macatawa Bank's customers with an expanded array of products and services and are thrilled to welcome Macatawa Bank clients and team members to the Wintrust family."

The chairman of Macatawa, Richard L. Postma, said, "Wintrust provides Macatawa Bank with the ability to retain and enhance its uniquely personalized consumer and commercial community presence in the West Michigan area by retaining the Macatawa Bank name, its key employees, branches, and a legally constituted community bank board, as a separately chartered bank and the only Wintrust subsidiary bank located within the State of Michigan. We are confident that this transaction, which combines similar cultures and operating philosophies, will result in a continued community bank that offers all the enhanced services, products and technology of Wintrust to meet the evolving banking needs of our customers."

Over the past six months, WTFC shares have gained 13.6% compared with the industry's 23.6% growth.

Image Source: Zacks Investment Research

Currently, WTFC carries a Zacks Rank #3 (Hold).

Inorganic Growth Efforts by Other Finance Firms

A few days ago, Renasant Corp. RNST and The First Bancshares Inc. FBMS jointly entered a merger agreement. Per the agreement, First Bancshares will merge into Renasant for an all-stock consideration of $1.2 billion, based on the latter's closing stock price of $37.09 as of Jul 26, 2024.

Under the terms of the agreement, shareholders of First Bancshares will get one share of RNST's common stock for each of their shares. Moreover, all options of First Bancshares will be cashed out at their in-the-money value upon the closure of the deal.

The deal, which is expected to be closed by the first half of 2025, has been approved by the shareholders of both companies and awaits requisite regulatory approvals.

Last month, Eastern Bankshares Inc. EBC completed its merger with Cambridge Bancorp. The deal, announced in September 2023 with a 100% stock consideration, aligns with the company's inorganic growth strategy.

The merged private banking and wealth management divisions will work under the brand and leadership of Cambridge Trust as it has a distinct presence in its peer local markets. Other areas of the merged bank, including Commercial, Business and Consumer Banking, will operate under EBC's brand name.

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