The shares of Village Bank and Trust Financial Corp. (NASDAQ: VBFC) saw a notable increase on the announcement of a formal merger agreement. With a significant 47.48% increase, the stock price of VBFC closed the previous session at $77.00. The market’s favorable response to the news of a merger is reflected in the stock value increase.
Village Bank to Combine with TowneBank
Village Bank (VBFC), the parent firm of Village Bank, has signed a definitive merger agreement with TiowneBank. By acquiring Village Bank under the terms of this agreement, TowneBank will increase its footprint in the Richmond Metropolitan Statistical Area (MSA).
Through this merger, both institutions will have the chance to work together in ways that will promote a variety of revenue synergies. Furthermore, TowneBank hopes to use this purchase as a way to deploy cash more strategically throughout its expanding portfolio.
Advantages for Both VBFC Customers and Staff
It is anticipated that the combination of Village Bank and TowneBank would have several advantages. TowneBank’s expanded resources will enable Village Bank clients to access a wider selection of goods and services.
TowneBank will expand its presence in the Richmond area concurrently, which is crucial to its long-term expansion plan. since a result of the merger, workers should have more career options since both banks will be able to benefit from one other’s advantages.
An overview of the finances and the impact on shareholders
The merged company is expected to have $17.8 billion in total assets, $12.1 billion in loans, and $14.9 billion in deposits as of June 30, 2024, according to financial data. Each share of VBFC stock will be paid to Village Bank stockholders in cash for $80.25, resulting in a total transaction value of almost $120.0 million.
Following the complete execution of cost savings, TowneBank anticipates that the purchase will add about 6% to its profits per share.
Timeline for Transactions and Approvals
Before completing the deal, TowneBank and Village Bank carried out a thorough due diligence process. The merger has been accepted by the boards of directors of both firms. Expected to completion in the first half of 2025, the acquisition is pending shareholder approval and regulatory approval from Village Bank.
