ChoiceOne Financial Services, Inc. (NASDAQ: COFS) (“ChoiceOne”),
the parent company of ChoiceOne Bank, and Fentura Financial, Inc.
(OTCQX: FETM) (“Fentura”), the parent company of The State Bank,
today announced the signing of a definitive merger agreement
pursuant to which ChoiceOne and Fentura will merge in an all-stock
transaction. The agreement was unanimously approved by the boards
of directors of both companies.
Once completed, the combination will create the
third largest publicly traded bank in Michigan with approximately
$4.3 billion in consolidated total assets and 56 offices in
Western, Central and Southeastern Michigan. The proposed
transaction is expected to close in the first quarter of 2025,
subject to the satisfaction of customary closing conditions,
including receipt of approval from Fentura and ChoiceOne
shareholders and receipt of all necessary regulatory approvals.
Under the terms of the merger agreement, each
share of Fentura common stock outstanding immediately prior to
completion of the merger will be converted into the right to
receive 1.35 shares of ChoiceOne common stock. The proposed
transaction is valued at $40.18 per share of Fentura common stock,
or approximately $180.4 million in the aggregate, based on the
closing price of ChoiceOne’s common stock of $29.76 on July 24,
2024. For additional information about the proposed merger, please
see the Investor Presentation – Merger, filed as Exhibit 99.4 to
ChoiceOne’s Form 8-K filed on July 25, 2024.
Subject to NASDAQ independence standards and
existing corporate governance procedures, upon completion of the
proposed transaction, ChoiceOne intends to appoint two members of
Fentura’s board to join the holding company board of ChoiceOne,
which would be comprised of 15 total directors. Two additional
members of Fentura’s board will also be appointed to join the board
of ChoiceOne Bank, which would be comprised of 17 total
directors.
"We are thrilled to announce the proposed
combination of two 125+ year old community banks. Fentura is a
well-run institution and a natural geographical extension for
ChoiceOne. This transaction will allow ChoiceOne to strengthen its
presence in the suburbs of Detroit while adding the markets of
Flint and Saginaw. We remain committed to our local Michigan
communities, and this transaction will enhance that commitment,"
said ChoiceOne Chief Executive Officer, Kelly Potes.
“This is an exciting time for our customers, communities,
employees and shareholders as we move into the next phase of the
combined company’s growth together,” said Jack Hendon, Chairman of
ChoiceOne Financial Services, Inc. “Both companies are similar in
their culture, rich history, values and commitment to serve their
respective customers and communities. The proposed combination will
allow us to expand our collective expertise and enhance our product
offering to better support our customers.”
“Identifying the right partner with a compatible
culture was crucial when we evaluated this proposed transaction,”
said Ronald Justice, President & CEO of Fentura. “Fentura and
ChoiceOne share remarkably similar cultures and values. Both are
robust, growing institutions deeply dedicated to customer service
and community engagement. By harnessing these strengths in our
proposed combination, along with our complementary products and
prominent market positions, we believe we will establish ourselves
as one of Michigan's premier community banks. We believe our
shareholders will benefit from significantly greater liquidity and
an indicated dividend which will be more than three times higher
than our current dividend.”
“Combining two thriving banks will enable us to
provide a wider array of services and build a deeper bench of
expertise within our communities,” said Brian Petty, Chairman of
Fentura. “Our combined customer base anticipates outstanding
service across various delivery channels. With each bank boasting
more than 125 years of dedicated customer service, we aim to
establish ourselves as the leading financial institution in our
markets.”
Janney Montgomery Scott LLC is serving as
financial advisor and Warner Norcross + Judd LLP is serving as
legal counsel to ChoiceOne. Hovde Group, LLC is serving as
financial advisor and Dickinson Wright PLLC is serving as legal
counsel to Fentura.
About ChoiceOne
Financial Services, Inc. and ChoiceOne BankChoiceOne
Financial Services, Inc. is a financial holding company
headquartered in Sparta, Michigan, and the parent corporation of
ChoiceOne Bank, Member FDIC. ChoiceOne Bank operates 35 offices in
parts of Kent, Ottawa, Muskegon, Newaygo, Lapeer, St. Clair,
Macomb, and Oakland counties. ChoiceOne is an approximately $2.6
billion-asset bank holding company making it the eighth largest
bank holding company in Michigan based on asset size. ChoiceOne
Bank offers insurance and investment products through its
subsidiary, ChoiceOne Insurance Agencies, Inc. ChoiceOne Financial
Services, Inc. common stock is quoted on the Nasdaq Capital Market
under the symbol "COFS." For more information, please visit
Investor Relations at ChoiceOne's website choiceone.bank.
About Fentura
Financial, Inc.
and The State
BankFentura Financial, Inc. is the holding company
for The State Bank. It was formed in 1987 and is traded on the
OTCQX exchange under the symbol “FETM,” and has been recognized as
one of the Top 50 performing stocks on that exchange.
The State Bank is a commercial, retail and trust
bank headquartered in Fenton, Michigan. It currently operates 20
full-service offices and one loan production center serving Bay,
Genesee, Ingham, Livingston, Oakland, Saginaw, and Shiawassee
counties. The State Bank believes in the potential of banking to
help create better lives, better businesses, and better
communities, and works to achieve this through its full array of
consumer, mortgage, SBA, commercial and wealth management banking
and advisory services, together with philanthropic and volunteer
support to organizations and groups within the communities it
serves. More information can be found at www.thestatebank.com or
www.fentura.com.
Forward-Looking Statement
This presentation contains forward-looking
statements within the meaning of the federal securities laws
relating to the proposed merger of Fentura Financial Corporation
(“Fentura”) and ChoiceOne Financial Corporation (“ChoiceOne”) and
integration of Fentura with ChoiceOne, the combination of their
businesses and projected or pro forma financial information and
metrics, and the registered follow-on offering of common stock by
ChoiceOne. All statements other than statements of historical fact
are statements that could be deemed forward-looking statements,
including all statements regarding the intent, belief or current
expectations of ChoiceOne and Fentura and members of their
respective directors and senior management teams. Investors and
security holders are cautioned that such statements are
predictions, are not guarantees of future performance and actual
events or results may differ materially. Completion of the proposed
merger, expected financial results or other plans are subject to a
number of risks and uncertainties.
Additional risks and uncertainties may include,
but are not limited to, the risk that expected cost savings,
revenue synergies and other financial benefits from the proposed
merger may not be realized or take longer than expected to realize,
the failure to obtain required regulatory or shareholder approvals,
the failure of the closing conditions in the merger agreement to be
satisfied or any unexpected delay in closing the proposed
transaction.
For further information regarding additional
factors that could cause results to differ materially from those
contained in the forward-looking statements, see “Risk Factors” and
the forward-looking statement disclosure contained in the Annual
Report on Form 10-K for the most recently ended fiscal year of
ChoiceOne, as well as the proxy statement/prospectus described
below, and other documents subsequently filed by ChoiceOne with the
Securities and Exchange Commission. Forward-looking statements are
based on information currently available to ChoiceOne and Fentura,
and the parties assume no obligation and disclaim any intent to
update any such forward-looking statements.
Important Information for Investors and Security
Holders
This communication is being made in respect of
the proposed merger transaction involving ChoiceOne and Fentura.
This material is not a solicitation of any vote or approval of the
ChoiceOne or Fentura shareholders and is not a substitute for the
proxy statement/prospectus or any other documents that ChoiceOne
and Fentura may send to their respective shareholders in connection
with the proposed transaction. This communication does not
constitute an offer to sell or the solicitation of an offer to buy
any securities. The proposed merger transaction will be submitted
to the shareholders of ChoiceOne and Fentura for their
consideration. In connection therewith, ChoiceOne intends to file
relevant materials with the Securities and Exchange Commission (the
“SEC”), including a Registration Statement on Form S-4, which will
include the proxy statement of ChoiceOne and Fentura that also will
constitute a prospectus of ChoiceOne (the “proxy
statement/prospectus”), as well as other relevant documents
concerning the proposed transaction. However, such materials are
not currently available. The proxy statement/prospectus will be
mailed to the shareholders of ChoiceOne and Fentura when available.
BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS, INVESTORS AND
SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT AND
THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION
AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE SEC AND
ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS CAREFULLY AND IN
THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT CHOICEONE, FENTURA, THE PROPOSED
TRANSACTION AND RELATED MATTERS. Shareholders are also urged to
carefully review and consider ChoiceOne’s public filings with the
SEC, including, but not limited to, its proxy statements, its
Annual Reports on Form 10-K, its Quarterly Reports on Form 10-Q and
its Current Reports on Form 8-K. Investors and security holders may
obtain free copies of the proxy statement/prospectus, any
amendments or supplements thereto and other documents containing
important information about ChoiceOne or Fentura and/or the
proposed transaction, once such documents are filed with the SEC,
at the SEC’s website at www.sec.gov. In addition, copies of the
documents filed with the SEC by ChoiceOne, including the proxy
statement/prospectus and the SEC filings that will be incorporated
by reference in the proxy statement/prospectus, will be available
free of charge on the ChoiceOne’s website at choiceone.bank under
the heading “Investor Relations” or by contacting Adom Greenland,
Chief Financial Officer at (616) 887-7366.
Participants in the Solicitation
ChoiceOne, Fentura and certain of their
respective directors, executive officers and other members of
management and employees may, under the SEC’s rules, be deemed to
be participants in the solicitation of proxies in connection with
the proposed transaction. Information about the directors and
executive officers of ChoiceOne is set forth in its proxy statement
for its 2024 annual meeting of shareholders, which was filed with
the SEC on April 11, 2024, its annual report on Form 10-K for the
fiscal year ended December 31, 2023, which was filed with the SEC
on March 13, 2024, and in other documents filed with the SEC, each
of which can be obtained free of charge from the sources indicated
above. Additional information regarding the participants in the
proxy solicitation, including a description of their direct and
indirect interests, by security holdings or otherwise, will be
contained in the proxy statement/prospectus and other relevant
materials to be filed with the SEC when they become available. Free
copies of these documents may be obtained as described in the
preceding paragraph.
Contacts: |
Ronald L. JusticePresident &
CEOFentura Financial,
Inc.810.714.3902ron.justice@thestatebank.com |
Aaron D. WirsingChief Financial
OfficerFentura Financial,
Inc.810.714.3925aaron.wirsing@thestatebank.com |
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