Gunster's Greg Bader
Gunster’s Greg Bader (handout)

For shareholders of Sarasota-based Insignia Bank, the stock market’s so-called Trump Bump has meant an $11.6 million windfall.

Pompano Beach-based Stonegate Bank — which accepted a $778 million buyout offer Monday — agreed to acquire Insignialast summer in a deal that at that time represented $36.5 million in Stonegate shares, said Gregory K. Bader, a partner at the Gunster law firm who specializes in banking and financial services and represented Stonegatein the transaction.

But banking industry stocks rose across the board after the presidential election based on perceptions that interest rates would rise and banks would face less regulation. When the acquisition closed March 7, the agreed-upon shares of Stonegate had risen in value to $48.1 million — a 32 percent increase.

“The stock blew through the roof,” said Bader, who works in Gunster’s Fort Lauderdale office. “The Trump Bump in bank stocks increased the value of the deal to the Insignia shareholders.”

State-chartered Stonegate announced Monday that it agreed to be purchased by Home BancShares,the holding company for Centennial Bank based in Conway, Arkansas, in a cash and stock deal expected to close in the fourth quarter. Cash represents 7 percent of the transaction value.

Bader said the dramatic increase in the share value after the Insignia purchase announcement didn’t impact Stonegate because the number of shares issued to Insignia — 997,205 — was set based on a formula. Stonegate agreed to trade 0.3799 shares of its stock for each share of Insignia common stock, plus cash for any fractional shares.

At the end of 2016, Insignia held $244 million in assets, $203 million in deposits and $190 million in loans at two branches in Sarasota, and two loan production offices in Manatee and Pinellas counties. A branch in Fruitville will close as a result of the deal. An overwhelming majority of Insignia shareholders voted to sell on Dec. 14.

After the merger, the 12-year-old Stonegate held $3.1 billion in assets, and Insignia Bank shareholders held about 6.5 percent of Stonegate Bank, which has nearly two dozen branches in Florida.

The rise in the value of Stonegate shares was driven in part by an anticipated rise in interest rates and the perception that the Trump administration will cut regulations, Bader said. It remains to be seen whether the favorable winds for banks will continue in the long term, but Bader said the trend is leading to an uptick in new bank creation. Florida has lost 15 to 25 banks a year without adding replacements, he said, adding, “There are fewer banks out there.”

In addition to Bader who handled the merger and deal negotiations, the Gunster team representing Stonegate included Tom Hickey, a partner in West Palm Beach who handled executive compensation, Gustav Schmidt, a senior associate in Fort Lauderdale also assisted on merger and deal negotiations and Freddie Brackin, an associate in Fort Lauderdale who handled tax matters.

Jack Greeley of Smith Mackinnon in Orlando represented Insignia Bank in the transaction.

The deal was Stonegate’s 10th acquisition since 2009, according to MarketWatch. In addition to Insignia, Gunster has handled a handful of Stonegate’s acquisitions over the last five years, including Florida Shores Bancorp Inc., Community Bank of Broward and Regent Bancorp Inc. Bader and Schmidt took Stonegate public in 2014.

In the sale to Home BancShare, Stonegate is represented by Squire Patton Boggs. That deal team is led by Squire Patton partner James Barresi in Cincinnati, who leads the global financial services practice, with of counsel Erich Hellmold in Washington and associate Kate Selander in Cincinnati, both of financial services. Partner David Zagore in Cleveland and associate Christina Heithaus in Cincinnati dealt with corporate matters. Partners Carl Draucker in Cleveland and Jake Smith in Phoenix worked on tax and partner Stacy Krumin in Tampa dealt with real estate issues. Home BancShare’s legal adviser on the transaction is Mitchell, Williams, Selig, Gates & Woodyard in Little Rock, Arkansas.

Stonegate Bankwas in the news in 2015 and 2016 when it became the first U.S. bank since a thaw in relations between the U.S. and Cuba to support debit cards and credit card transactions in Cuba.

For shareholders of Sarasota-based Insignia Bank, the stock market’s so-called Trump Bump has meant an $11.6 million windfall.

Pompano Beach-based Stonegate Bank — which accepted a $778 million buyout offer Monday — agreed to acquire Insignialast summer in a deal that at that time represented $36.5 million in Stonegate shares, said Gregory K. Bader, a partner at the Gunster law firm who specializes in banking and financial services and represented Stonegatein the transaction.

But banking industry stocks rose across the board after the presidential election based on perceptions that interest rates would rise and banks would face less regulation. When the acquisition closed March 7, the agreed-upon shares of Stonegate had risen in value to $48.1 million — a 32 percent increase.

“The stock blew through the roof,” said Bader, who works in Gunster’s Fort Lauderdale office. “The Trump Bump in bank stocks increased the value of the deal to the Insignia shareholders.”

State-chartered Stonegate announced Monday that it agreed to be purchased by Home BancShares,the holding company for Centennial Bank based in Conway, Arkansas, in a cash and stock deal expected to close in the fourth quarter. Cash represents 7 percent of the transaction value.

Bader said the dramatic increase in the share value after the Insignia purchase announcement didn’t impact Stonegate because the number of shares issued to Insignia — 997,205 — was set based on a formula. Stonegate agreed to trade 0.3799 shares of its stock for each share of Insignia common stock, plus cash for any fractional shares.

At the end of 2016, Insignia held $244 million in assets, $203 million in deposits and $190 million in loans at two branches in Sarasota, and two loan production offices in Manatee and Pinellas counties. A branch in Fruitville will close as a result of the deal. An overwhelming majority of Insignia shareholders voted to sell on Dec. 14.

After the merger, the 12-year-old Stonegate held $3.1 billion in assets, and Insignia Bank shareholders held about 6.5 percent of Stonegate Bank, which has nearly two dozen branches in Florida.

The rise in the value of Stonegate shares was driven in part by an anticipated rise in interest rates and the perception that the Trump administration will cut regulations, Bader said. It remains to be seen whether the favorable winds for banks will continue in the long term, but Bader said the trend is leading to an uptick in new bank creation. Florida has lost 15 to 25 banks a year without adding replacements, he said, adding, “There are fewer banks out there.”

In addition to Bader who handled the merger and deal negotiations, the Gunster team representing Stonegate included Tom Hickey, a partner in West Palm Beach who handled executive compensation, Gustav Schmidt, a senior associate in Fort Lauderdale also assisted on merger and deal negotiations and Freddie Brackin, an associate in Fort Lauderdale who handled tax matters.

Jack Greeley of Smith Mackinnon in Orlando represented Insignia Bank in the transaction.

The deal was Stonegate’s 10th acquisition since 2009, according to MarketWatch. In addition to Insignia, Gunster has handled a handful of Stonegate’s acquisitions over the last five years, including Florida Shores Bancorp Inc., Community Bank of Broward and Regent Bancorp Inc. Bader and Schmidt took Stonegate public in 2014.

In the sale to Home BancShare, Stonegate is represented by Squire Patton Boggs . That deal team is led by Squire Patton partner James Barresi in Cincinnati, who leads the global financial services practice, with of counsel Erich Hellmold in Washington and associate Kate Selander in Cincinnati, both of financial services. Partner David Zagore in Cleveland and associate Christina Heithaus in Cincinnati dealt with corporate matters. Partners Carl Draucker in Cleveland and Jake Smith in Phoenix worked on tax and partner Stacy Krumin in Tampa dealt with real estate issues. Home BancShare’s legal adviser on the transaction is Mitchell, Williams, Selig, Gates & Woodyard in Little Rock, Arkansas.

Stonegate Bankwas in the news in 2015 and 2016 when it became the first U.S. bank since a thaw in relations between the U.S. and Cuba to support debit cards and credit card transactions in Cuba.