Lsb Bancshares (NASDAQ:LXBK)
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LSB Bancshares, Inc. (NASDAQ:LXBK) and FNB Financial Services
Corporation (NASDAQ:FNBF) announced today that they have entered into a
definitive agreement to combine in a merger of equals transaction.
Under the terms of the agreement, FNB shareholders will receive 1.07
shares of LSB Bancshares common stock for each of their shares of FNB
common stock. The combined organization will have 42 full-service
banking offices, total assets of approximately $2 billion and total
deposits of approximately $1.6 billion. It will be headquartered in
Greensboro, North Carolina and governed by a Board of Directors
comprised of 20 directors, 10 from each of the combining institutions.
Current LSB Chairman of the Board and Chief Executive Officer Robert F.
Lowe will serve as Chairman of the Board and Chief Executive Officer of
the company and Chairman of its subsidiary bank. Pressley A. Ridgill,
current President and Chief Executive Officer of FNB, will serve as
President of the company and President and Chief Executive Officer of
the bank. Barry Z. Dodson, Chairman of FNB, will serve as Vice Chairman
and lead independent director of the company. The merger is subject to
approval by LSB’s and FNB’s
shareholders and banking regulators and other customary conditions. The
transaction, which is expected to yield approximately $5 million in near
term annual cost savings, is scheduled to be completed during the third
quarter of 2007.
“This combination will create the sixth
largest bank based in North Carolina and will enable us to pursue our
vision of leveraging our diverse strengths, achieving sustained earnings
growth, expanding our branch network and ultimately seeking acquisition
opportunities and merger partners. LSB and FNB are quality focused
financial institutions with impressive infrastructures and traditions of
excellent service to our customers. There are many other similarities
between the two companies. We operate in similar North Carolina
communities and have branches in fast growing metropolitan markets. We
both have an experienced staff that is empowered to make decisions in
order to meet our customers’ banking needs at
the local level. LSB and FNB have a shared vision of the future and the
integration of our institutions is a natural fit,”
said Bob Lowe, Chairman and Chief Executive Officer of LSB. Mr. Lowe
added, “I am pleased to join Pressley in the
management of our new company. His broad experience in banking at the
chief financial, chief operating and chief executive officer levels is
an asset which will be critical to our company’s
future.”
Mr. Ridgill stated, “We believe this
transaction creates a beneficial situation for all our constituencies.
Our customers will enjoy our expanded geographic footprint and the
communities we serve will benefit from our enhanced and more competitive
products and services. Our employees will be partnered with a larger,
more vibrant company with more opportunities for advancement, and our
shareholders will benefit from significant increased earnings
opportunities. The combination provides the opportunity to combine the
loan growth available in FNB’s markets with
the funding provided by LSB’s strong core
deposit base. We will have many opportunities to expand our footprint
while preserving our historic roots in Davidson and Rockingham Counties.
I look forward to working with Bob and benefiting from his deep
knowledge of banking.”
Mr. Lowe noted that “there is no overlap
between our branch networks. As a result, we expect minimal staffing
modifications in our primary locations of service to our customers.”
Mr. Ridgill added that “the current plans for
the combined company are to maintain our operation centers in Davidson
County and Rockingham County. Our goal in uniting our companies is to
grow our presence in all of our markets.”
In connection with the transaction, BankersBanc Capital Corporation is
acting as financial advisor and has provided a fairness opinion to LSB,
with FNB using Howe Barnes Hoefer & Arnett, Inc. Brooks, Pierce,
McLendon, Humphrey & Leonard, L.L.P., regular counsel to both companies,
is acting as the legal counsel for the companies charged with effecting
the transaction. Brinkley Walser, PLLC and Ward and Smith, P.A., serve
as special merger counsel to LSB and FNB, respectfully.
About the Companies
LSB Bancshares, Inc. is the parent company of Lexington State Bank.
Lexington State Bank is a community bank based in the Piedmont region of
North Carolina and operates 25 branches in Davidson, Guilford, Forsyth,
Randolph and Stokes Counties. It has two primary subsidiaries: LSB
Investment Services, Inc., which provides non-deposit, non-insured
investment alternatives such as mutual funds and annuities through a
registered brokerage firm, and Peoples Finance Co. of Lexington, Inc.,
which offers small loans and dealer financing. The common stock of LSB
Bancshares, Inc. is traded on the NASDAQ Global Select Market under the
NASDAQ symbol “LXBK.”
FNB Financial Services Corporation is the parent company of FNB
Southeast, which is a full service community bank headquartered in
Greensboro, North Carolina and providing services through 17 branches
throughout its four regions in North Carolina and Virginia. The
Greensboro region serves Guilford and the surrounding North Carolina
counties. The Coastal region serves the North Carolina counties of New
Hanover, Brunswick and Pender. The Rockingham region serves Rockingham
and surrounding counties. The Shenandoah region, headquartered in
Harrisonburg, Virginia, serves Rockingham County, Virginia. The Bank
provides mortgage services through its subsidiary, FNB Southeast
Mortgage Corporation. Securities brokerage services are provided by FNB
Southeast Investment Services, Inc. through a registered brokerage firm.
The common stock of FNB Financial Services Corporation is traded on
NASDAQ Global Market under the symbol “FNBF.”
Additional Information About The Companies and This Transaction
In connection with the merger, LSB will file a registration statement,
which will include a joint proxy statement/prospectus to be sent to each
company’s stockholders, and each of LSB and
FNB may file other relevant documents concerning the merger with the
Securities and Exchange Commission (the “SEC”).
Stockholders are urged to read the registration statement and the joint
proxy statement/prospectus regarding the merger when they become
available and any other relevant documents filed with the SEC, as well
as any amendments or supplements to those documents, because they will
contain important information.
You will be able to obtain a free copy of the joint proxy
statement/prospectus, as well as other filings containing information
about LSB and FNB, at the SEC’s website (http://www.sec.gov).
(You will also be able to obtain these documents, free of charge, by
accessing LSB’s website (http://www.lsbnc.com),
or by accessing FNB’s website (http://www.fnbsoutheast.com).)
LSB and FNB and their respective directors and executive officers may be
deemed to be participants in the solicitation of proxies from the
stockholders of LSB and/or FNB in connection with the merger.
Information about the directors and executive officers of LSB is set
forth in the proxy statement for LSB’s 2006
annual meeting of stockholders, as filed with the SEC on March 15, 2006.
Information about the directors and executive officers of FNB is set
forth in the proxy statement for FNB’s 2006
annual meeting of stockholders, as filed with the SEC on March 23, 2006.
Additional information regarding the interests of those participants and
other persons who may be deemed participants in the transaction may be
obtained by reading the joint proxy statement/prospectus regarding the
merger when it becomes available. You may obtain free copies of these
documents as described above.
Safe Harbor Statement Under the Private Securities Litigation Reform
Act of 1995
This release contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Act of 1934 as amended. These include
statements as to the benefits of the merger, including future financial
and operating results, cost savings, enhanced revenues and the
accretion/dilution to reported earnings that may be realized from the
merger as well as other statements of expectations regarding the merger
and any other statements regarding future results or expectations. Each
of LSB and FNB intends such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements contained in
the Private Securities Litigation Reform Act of 1995 and is including
this statement for purposes of these safe harbor provisions.
Forward-looking statements, which are based on certain assumptions and
describe future plans, strategies, and expectations of each of LSB and
FNB, are generally identified by the use of words such as “believe,”
“expect,” “intend,”
“anticipate,” “estimate,”
or “project” or
similar expressions. The companies’
respective ability to predict results, or the actual effect of future
plans or strategies, is inherently uncertain. Factors which could have a
material adverse effect on the operations and future prospects of each
of LSB and FNB and their respective subsidiaries include, but are not
limited to: the risk that the businesses of LSB and/or FNB will not be
integrated successfully or such integration may be more difficult,
time-consuming or costly than expected; expected revenue synergies and
cost savings from the merger may not be fully realized or realized
within the expected time frame; revenues following the merger may be
lower than expected; customer and employee relationships and business
operations may be disrupted by the merger; the ability to obtain
required governmental and stockholder approvals, and the ability to
complete the merger on the expected timeframe; changes in interest
rates, general economic conditions, legislative/regulatory changes,
monetary and fiscal policies of the U.S. government, including policies
of the U.S. Treasury and the Federal Reserve Board; the quality and
composition of the loan and securities portfolios; demand for loan
products; deposit flows; competition; demand for financial services in
the companies’ respective market areas; their
implementation of new technologies; their ability to develop and
maintain secure and reliable electronic systems; and accounting
principles, policies, and guidelines. These risks and uncertainties
should be considered in evaluating forward-looking statements and undue
reliance should not be placed on such statements.
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy securities, nor shall there be any sale
of securities in any jurisdiction in which such solicitation or sale
would be unlawful prior to the registration or qualification under the
securities laws of such jurisdiction.
MEDIA ADVISORY – EVENT AUDIO CONFIRMATION
A significant, positive business development affecting Greensboro,
Guilford County (NC) and the region will be unveiled at a news
conference Tuesday, Feb. 27 at 10:30 a.m. at the Grandover Resort and
Conference Center.
You can patch into the news conference (Live) using the following
phone number: Toll Free (866) 835-8905.