Baton Rouge-based Investar Holding Corporation, the holding company for Investar Bank, announced today it has entered into an agreement to acquire Cheaha Financial Group Inc. headquartered in Oxford, Alabama, and its wholly-owned subsidiary, Cheaha Bank.
In connection with the Cheaha transaction, Investar also announced the execution of a stock purchase agreement with selected institutional and other accredited investors regarding a private placement of $30 million of its common stock.
The terms of the agreement provide that Cheaha shareholders will receive $80 in cash consideration for each of their shares of Cheaha common stock, for an aggregate value of approximately $41.1 million.
As of Sept. 30, Cheaha Bank had approximately $206.7 million in assets, $117.2 million in net loans, $177.1 million in deposits and $27.5 million in stockholder’s equity. Cheaha Bank has four branch locations in Calhoun County, Alabama.
The merger—Investar’s second acquisition along the I-20 corridor in Alabama this year—is part of the Louisiana bank’s multistate expansion strategy.
Cheaha will transition to the Investar name, but its staff members are expected to stay on after the acquisition.
The acquisition has been unanimously approved by both banks’ boards of directors. The transaction is expected to close in the second quarter of 2020, subject to customary conditions and approval by Cheaha shareholders. See the full announcement.
