CommunityOne, Bank of Granite merge
FNB United Corp. (Nasdaq: FNBN), parent company of CommunityOne Bank, N.A., and Bank of Granite Corp. (Nasdaq: GRAN), parent company of Bank of Granite, today announced plans to merge, contingent on shareholder, regulatory and other approvals, the successful recapitalization of FNB United and other conditions.
The merger of these 100-year-old institutions will create a North Carolina community banking organization with approximately $2.9 billion in assets, $2.4 billion in deposits and 63 full-service banking offices.
The combined parent company will be called FNB United Corp., and will be operated by new management, led by Brian Simpson as chief executive officer and Bob Reid as president.
FNB United will be headquartered in Asheboro. The transaction is expected to close during the third quarter.
Thereafter, the two bank subsidiaries (CommunityOne and Bank of Granite) will be operated as separate entities until a future date, after which the merged bank will be named CommunityOne Bank, N.A.
As part of this transaction, The Carlyle Group and Oak Hill Capital Partners, two private equity firms with a history of successful investing in the financial services sector, have each entered into definitive agreements with FNB United to invest $77.5 million in the common stock of FNB United subject to the conditions set forth in the agreements as part of a $310 million private placement of FNB United’s common stock.
The Carlyle Group and Oak Hill Capital Partners will each receive approximately 484 million shares of common stock at the closing not to exceed 24.9 percent of the then-outstanding shares of common stock, valued at $0.16 a share.
“Bank of Granite and CommunityOne share many synergies, including the top priority of providing excellent and reliable banking services to our local communities,” said John Bray, dhairman of Bank of Granite.
“Both institutions have enjoyed great successes and weathered challenging times for more than a century, and the announcements today will help position both companies for the future.”
Jim Campbell, chairman of FNB United, said, “The past few years have presented FNB United with significant challenges, and through this proposed merger we will embrace a new way forward from a position of strength. We are excited that the prospective management team is led by native North Carolinians, Brian Simpson as chief executive officer and Bob Reid as president, who will provide exceptional leadership for this new institution.”