Investar Holding in Baton Rouge, La., has agreed to buy Wichita Falls Bancshares in Wichita Falls, Texas.
The $2.7 billion-asset Investor said in a press release that it will pay $83.6 million in cash and stock for the $1.6 billion-asset Wichita Falls. The deal, which is expected to close in the fourth quarter, priced Wichita Falls at 88.8% of its tangible book value.
Investar also announced a private placement of $32.5 million of newly designated 6.5% Series A non-cumulative perpetual convertible preferred stock. The company also plans to sell about $200 million of mortgage loans, using proceeds to eliminate Wichita Falls’ borrowings and to push out high-cost, noncore deposits.
Wichita Falls has seven branches and two mortgage offices.
“This is a watershed moment for our bank and our shareholders,” John D’Angelo, Investar’s president and CEO, said in the release. “This is more than a strategic move; it’s a powerful alignment of values and purpose.”
The deal should be 35% accretive to Investar’s 2026 earnings per share. It should take less than three years for Investar to earn back any dilution to its tangible book value.
Investar plans to cut about 36% of Wichita Falls’ annual noninterest expenses, though no branches are expected to close. Investar expects to incur $4.6 million of pretax merger-related expenses.
Two Wichita Falls directors will join Investar’s board.
Janney Montgomery Scott and Fenimore Kay Harrison advised Investar. Olsen Palmer and Bradley Arant Boult Cummings advised Wichita Falls.