DEARBORN, Mich.—The $6.4-billion DFCU Financial here has agreed to buy $689-million First Citrus Bank, based in Tampa, Fla., the credit union announced.
In an all-cash transaction, DFCU will pay $47.75 per share. DFCU will also cash out the outstanding options at FCB at the difference between the strike price and the per share cash consideration to FCB shareholders, DFCU reported.
The move will mark DFCU’s first entry into the state of Florida. The agreement will give DFCU 33 branch locations across Michigan and Florida.
“First Citrus represents DFCU’s initial expansion into Florida and a significant increase in commercial lending presence and expertise,” said DFCU President and CEO Ryan Goldberg. “(First Citrus Bank) CEO Jack Barrett’s leadership has fostered a customer centric culture that closely aligns with DFCU’s core values. We look forward to benefiting from his leadership going forward.
Added Barrett, “We’re delighted that DFCU has chosen Tampa Bay as their Florida headquarters and honored they have entrusted our executive team to build upon their 72-year history. This merger is not only a win for our shareholders, it’s a win for our associates, clients, Tampa Bay, and frankly the state of Florida. DFCU’s midwestern values align well with ours.”
Management Team to be Retained
Upon completion of the transaction, the organizations said the entire management team of FCB will join DFCU, with Barrett being named Florida market president and the remaining executives fulfilling similar roles as they currently hold at FCB for the Florida operations of DFCU. Additionally, DFCU said it intends to keep all of FCB’s branches open following completion of the transaction.
The transaction, contingent on approval by the shareholders of FCB and regulators, is expected to be completed in the fourth quarter of 2022.
FDIC data show that First Citrus Bank made $7.3 million in 2021 and $5.1 million the previous year.
DFCU Financial, which has 232,471 members, posted $19.47 million in net income in Q1, with 11.95% capital..
Two Things Happening
“Two things continue to happen,” stated Michael Bell, the pioneer of credit union purchases of banks. “More banks are choosing to include credit unions in the process when they sell—which we are clearly seeing this year—and CUs are using bank buys to enter new markets and gain talent and capabilities.”
Bell is a partner and co-chair of the Financial Institutions Practice Group at Honigman, LLP, which is representing DFCU Financial. Bell has been involved in more than 45 whole-bank agreements, plus additional bank branch purchases.