Home Bancshares Shares Soar over Liberty Bancshares Deal (HOMB)

Home Bancshares Inc. (NASDAQ: HOMB) announced on Tuesday that it will be acquiring privately held Jonesboro, Arkansas-based Liberty Bancshares Inc. The deal will create a $7.1 billion Company and the second largest bank, based in Arkansas. The new entity will overtake First Security Bank of Searcy, which was thus far the second largest Arkansas based company, in terms of assets. According to the terms of the deal, Liberty’s shareholders will be offered $250 million worth common stock of Home Bancshares along with $30 million in cash. Announcing the deal on Tuesday, the two companies said that the merger is the largest banking transaction in the history of Arkansas State, adding that it (the merged entity) will become second largest banking company in Arkansas. Fayetteville based Arvest is the largest bank in the state of Arkansas. Commenting over the deal, Home Bancshares Chairman, John Allison said to analysts in a conference call, “It’s a win-win for both institutions.” Home Bancshares said that Liberty Bank will merge with its subsidiary Centennial once the transaction is completed. “Very seldom do you see two organizations that go together and not have any duplication or problems with the people in it…But this is a true fit and it’s a perfect fit,” said Wallace Fowler, chairman of Liberty. The deal is expected close later this year, subject to an approval from shareholders and regulators. The merged entity will have 151 branches and 1,500 employees spread across Arkansas, Florida and Southern Alabama with $7.1 billion in assets, $4.5 billion in loans and $5.6 billion in deposits. In addition, the merger will doubled the number of Centennial Bank’s branches in Arkansas to 92 from 46. Shares of Home Bancshares soared more than 10% in early trade. Reacting over the deal, Gov. Mike Beebe congratulated the chairmen from both firms, saying that the merger would strengthen the state’s banking industry. “Both these guys have that same kind of Arkansas entrepreneurial spirit we talk about all the time,” Beebe said, according to San Francisco Chronicle.