MidWestOne Financial Group, Inc. (“MidWestOne”) (NASDAQ: MOFG) and Iowa First Bancshares Corp. (“IOFB”) (OTC Pink: IOFB) today jointly announced the execution of a definitive merger agreement providing for the acquisition of IOFB by MidWestOne in a transaction valued at approximately $47.6 million. The combined company will have approximately $6.2 billion in total assets with over 60 banking offices throughout Iowa, Minnesota, Wisconsin, Florida and Colorado.
IOFB operates five banking offices in Iowa through its two banks, First National Bank of Muscatine and First National Bank in Fairfield. First National Bank of Muscatine was founded in 1870, and as of September 30, 2021, had approximately $361.6 million in total assets with $315.9 million in deposits, and $203.9 million in total loans, net.
First National Bank in Fairfield was founded in 1865, and as of September 30, 2021, had approximately $157.6 million in total assets with $137.4 million in deposits, and $100.0 million in total loans, net.
As of September 30, 2021, MidWestOne had total assets of approximately $5.9 billion, operating thirty-four banking offices in Iowa, twelve banking offices in Minnesota, seven banking offices in Wisconsin, two banking offices in Florida, and one banking office in Colorado.
Under terms of the definitive merger agreement, the aggregate consideration to be paid by MidWestOne for IOFB will consist of cash consideration of $47.6 million, subject to adjustment. MidWestOne expects the transaction to be approximately 14.4% accretive to its earnings per share in 2022 (excluding one-time transaction expenses) and 10.8% accretive in 2023. The transaction is expected to be approximately 0.70% dilutive to tangible book value per share at closing, which dilution is expected to be earned back in less than one year. The definitive merger agreement has been unanimously approved by the boards of directors of both companies. The acquisition is expected to close during the first quarter of 2022 and is subject to approval by IOFB’s shareholders and regulatory agencies, as well as other customary closing conditions.