Atlantic Union Bankshares in Richmond, Va., has agreed to buy American National Bankshares in Danville, Va.
The $20.6 billion-asset Atlantic Union said in a press release that it will pay $416.8 million in stock for the $3.1 billion-asset American National. The deal, which is expected to close in the first quarter, valued American National at 174% of its tangible book value.
“American National is a high-quality community bank with an exceptional 114-year history, a strong core deposit base and outstanding asset quality,” John Asbury, Atlantic Union’s president and CEO, said in the release.
“This is a company and leadership team we have long admired and know well, and the relationship between our two banks spans decades,” Asbury added. “We expect that our combined footprint will bring additional convenience to our customers and position us as an even stronger competitor against the large national, super-regional and smaller community banks.”
Atlantic Union said it expects the deal to be 19% accretive to its earnings per share. It should take three years to earn back an estimated 9.7% dilution to the company’s tangible book value.
Atlantic Union plans to cut about 40% of American National’s annual noninterest expenses. The company expects to incur $32 million in merger-related expenses.
Two American National directors, Nancy Howell Agee and Joel Shepherd, will join Atlantic Union’s board. Jeff Haley, American National’s chairman, president and CEO, will assist with the integration and advise on the legacy American National markets. Haley will also serve as Atlantic Union’s representative to two Danville-based charitable trusts.
Piper Sandler and Covington & Burling advised Atlantic Union. Keefe, Bruyette & Woods, and Williams Mullen advised American National.