SouthState Corporation (NASDAQ: SSB) (“SouthState” or the “Company”) and Atlantic Capital Bancshares, Inc. (NASDAQ: ACBI) (“Atlantic Capital”) jointly announced today the signing of a definitive agreement pursuant to which Atlantic Capital will merge with and into SouthState in an all-stock transaction with an aggregate value of approximately $542 million, or $26.43 per share of Atlantic Capital common stock.
Atlantic Capital, based in Atlanta, Georgia, has approximately $3.8 billion in total assets, $3.3 billion in total deposits, and $2.3 billion in total loans as of June 30, 2021, and operates one branch in the Atlanta metro area and one branch in Athens, Georgia. This merger will enhance SouthState’s scale and improve market density in the attractive Atlanta market. SouthState will have top ten deposit market share in the Atlanta MSA, with approximately $5 billion in pro forma deposits. Upon merger completion, the combined company will have pro forma total assets of $44 billion, deposits of $36 billion, gross loans of $26 billion, and a market capitalization of approximately $5.7 billion.
“We are pleased to announce this partnership with Doug and his team at Atlantic Capital. Atlanta is a strategically important market for us, and this attractive, in-market transaction significantly expands our market share in one of the fastest growing cities in the country,” said John C. Corbett, Chief Executive Officer of SouthState. “Additionally, Atlantic Capital provides a high-growth Fintech and Payments platform and a seasoned team of Atlanta bankers with a proven record of success.”
Douglas L. Williams, President and CEO of Atlantic Capital, said, “This partnership with SouthState enhances our purpose to fuel prosperity for our shareholders, clients, and teammates. SouthState’s larger capital base and broader range of capabilities will strengthen our client relationships and expand our new business opportunities. Our companies are tightly aligned culturally; we operate on the same core banking and treasury management platforms, and our credit and risk management philosophies and processes are similar.”
Subject to the terms of the merger agreement, Atlantic Capital shareholders will receive 0.36 shares of SouthState common stock for each outstanding share of Atlantic Capital common stock. Based on SouthState’s stock price of $73.42 as of July 22, 2021, this equates to a per share value of $26.43 and an aggregate transaction value of $542 million. Additionally, two Atlantic Capital directors will join both the Company board and the SouthState Bank board.
The transaction is expected to result in 3% EPS accretion on a fully phased in basis and minimal tangible book value dilution, which is expected to be earned back in two years.
The merger agreement has been unanimously approved by the board of directors of Atlantic Capital and SouthState. Completion of the merger is subject to customary closing conditions, including receipt of required regulatory approvals and the approval by shareholders of Atlantic Capital. The transaction is expected to close in the first quarter of 2022.
Raymond James & Associates, Inc. served as exclusive financial advisor and Davis Polk & Wardwell LLP served as legal counsel to SouthState in the transaction. J.P. Morgan Securities LLC served as exclusive financial advisor and Sullivan & Cromwell LLP and Troutman Pepper Hamilton Sanders LLP served as legal counsel to Atlantic Capital in the transaction.
Joint Investor Conference Call
SouthState and Atlantic Capital will host a conference call to discuss the transaction and second quarter 2021 earnings results at 8:00 a.m. Eastern Time today. To listen to the live call, please dial 877-506-9272 within the U.S. and 412-380-2004 for all other locations and enter the participant code 10158736. The live webcast, along with the related presentation, will be available on the Investor Relations section of each company’s website at http://www.southstatebank.com/ and https://www.atlanticcapitalbank.com/. An audio replay is expected to be available the evening of July 23, 2021. To access the replay, dial 877-344-7529 and use conference number 10158736. International callers should dial 412-317-0088 and enter the same conference number.
As a result of today’s merger announcement, both companies have cancelled their previously scheduled second quarter 2021 earnings conference calls.