An Arkansas-based financial company is dropping north of $33 million to buy a Fort Lauderdale bank, paying a significant premium to crack into the South Florida market.
Broward Bank of Commerce, which has two branches in Fort Lauderdale and a share of the Broward County market of 0.3 of a percent, will become part of Arkansas’ Home BancShares Inc.
The branches held by Broward Financial Holdings Inc., with assets of $169 million, will now operate as Centennial Bank. The deal for the bank will involve the execution of outstanding warrants to buy shares in the Broward bank. Home BancShares, parent company of Centennial Bank, will then pay $33.06 million to $33.96 million for the bank, of which at least a 90 percent will be paid as stock.
Home BancShares has been in business since 1998 and has been acquiring other financial institutions since 2003. It has nine branches in the Florida Keys and four in southwest Florida, but none in the Miami-Fort Lauderdale-Palm Beach metropolitan area.
The bank being acquired has a loan book of $111 million, mostly in commercial and residential real estate.
The transaction puts a premium of about 65 percent on Broward’s of pro forma tangible common equity as of June 30.
“This is a nice opportunistic acquisition which allows us to further expand our current Florida footprint into attractive, long-term growth markets on the east coast of Florida,” John Allison, chairman of Home BancShares, said in a statement. “We are excited to begin serving the communities in this area.”