UMB Financial Corporation acquires Heartland Financial in $2bn deal
UMB Financial Corporation (UMB), the parent company of UMB Bank based in Missouri, USA, has entered into a definitive agreement to acquire Colorado-based bank holding company Heartland Financial USA (HTLF) in an all-stock transaction valued at around $2 billion.
UMB to acquire HTLF for $2 billion
As per the merger agreement terms, HTLF shareholders will receive a fixed exchange ratio of 0.55 shares of UMB common stock for each share of HTLF common stock. This amounts to a per-share value of $45.74 based on UMB’s closing price of $83.17 on 26 April 2024.
The firms expect the deal to be finalised in the first quarter of 2025 subject to customary closing conditions, including regulatory approvals and approval by HTLF and UMB shareholders.
The deal will also see five members of the HTLF board of directors join UMB’s board, enlarging it to 16 members. Moreover, it is anticipated that former HTLF stockholders will represent around 31% of the combined company.
Founded in 1981, HTLF’s banks serve customers in the West, Southwest and Midwest regions of the USA. It manages around $19.4 billion in assets, $12.1 billion in total loans, and $16.2 billion in total deposits as of 31 March 2024.
Upon completion of the deal, UMB Bank will manage around $64.5 billion in assets, positioning it among the top 5% of the 616 publicly traded banks in the US.
UMB’s chairman and CEO Mariner Kemper says that the acquisition will create a “regional banking powerhouse with a 13-state branch presence”.
The move will see UMB expand its banking operations into new states such as Iowa, Wisconsin, California, Minnesota, and New Mexico, while also adding 107 branches and 237 ATMs to its current roster of 90 branches and 238 ATMs.
