First Busey Corporation Finalizes Acquisition of Merchants and Manufacturers Bank Corporation and Merchants and Manufacturers Bank

Rhea-AI Summary

First Busey completes the acquisition of Merchants and Manufacturers Bank , enhancing its banking presence in multiple regions with an expanded product portfolio and customer base.

Insights

Market Research Analyst

The acquisition of Merchants and Manufacturers Bank Corporation by First Busey Corporation represents a strategic expansion in the Illinois banking sector. By integrating M&M's operations, Busey enhances its market share, particularly in the Chicago-Naperville-Elgin Metropolitan Statistical Area. The move to #4 in deposit share within DuPage and Will Counties signifies a substantial shift in the competitive landscape, potentially altering the dynamics of the local banking industry.

From a market share perspective, Busey's ascension to #8 in the Chicago MSA and #13 in Illinois overall for total deposit market share is notable. This level of market penetration can lead to increased economies of scale, allowing Busey to offer more competitive products and services. The transaction's financials, consisting of a mix of cash and stock, reflect a balanced approach to acquisition financing, which is likely to be well-received by investors seeking judicious capital management.

Financial Analyst

Examining the financial implications of the acquisition, the combined pro forma organization boasts $12.8 billion in assets, which may result in operational efficiencies and cost savings in the long term. The consolidation of locations, excluding the closure of one M&M banking office, suggests a strategic optimization of the branch network. This move will likely be scrutinized for its impact on customer experience and potential cost synergies.

Investors will be interested in how the $12.1 billion in wealth assets under care will be managed and whether this will lead to increased revenue streams for Busey. The market will also monitor the post-merger integration process closely, as the success of such transactions heavily depends on the seamless blending of corporate cultures and the retention of key staff and customer bases.

Economist

The transaction's impact on the regional economy could be multifaceted. On one hand, a larger banking entity like Busey could provide more robust financial services and potentially contribute to economic growth. On the other hand, the closure of M&M's Joliet banking office raises questions about local job losses and reduced banking access. The broader economic implications will hinge on how effectively Busey can leverage M&M's business banking expertise and maintain its commitment to community banking values.

Additionally, the enhancement of Busey's commercial banking and wealth management presence could attract more business clients and high-net-worth individuals, contributing to the economic vitality of the regions served. The long-term success of the merger will be measured by Busey's ability to sustain and grow these relationships.

CHAMPAIGN, Ill. and OAKBROOK TERRACE, Ill., April 01, 2024 (GLOBE NEWSWIRE) -- First Busey Corporation (“Busey”) (NASDAQ: BUSE), the holding company for Busey Bank, announced the completion of its acquisition of Merchants and Manufacturers Bank Corporation (“M&M”), the holding company for Merchants and Manufacturers Bank (“M&M Bank”), effective April 1, 2024. The transaction was previously announced on November 27, 2023.

At the effective time of the merger, each share of M&M common stock converted to the right to receive, at the election of each shareholder, and subject to proration and adjustment as provided in the merger agreement, (i) $117.74 in cash, (ii) 5.7294 shares of Busey common stock, or (iii) mixed consideration of $34.55 in cash and 4.0481 shares of Busey common stock, with total consideration consisting of approximately $12.2 million in cash and 1,429,324 shares of Busey common stock.

Busey will operate M&M Bank as a separate banking subsidiary of Busey until it is merged with Busey Bank, which is expected to occur in June 2024. At the time of the bank merger, M&M’s banking offices will become banking offices of Busey, except for the banking office located at 990 Essington Rd., Joliet, Illinois, which is expected to be closed in connection with the bank merger. The combined pro forma franchise will serve customers through 62 full-service locations, including 21 in Central Illinois markets, 17 in suburban Chicago markets, 20 in the St. Louis metropolitan area, one in Indianapolis and three in Southwest Florida. The pro forma organization had combined assets of $12.8 billion, $8.1 billion in loans, $10.7 billion in deposits and $12.1 billion in wealth assets under care as of December 31, 2023.

Busey Chairman, President and Chief Executive Officer Van A. Dukeman said, “Through this partnership, Busey and M&M will advance our community banking culture through our shared, longstanding commitments to supporting our associates, customers and communities. Our combined franchise benefits our clients through enhanced capabilities and products, including M&M’s Life Equity Loan® product, while a growing, dynamic organization presents more professional growth opportunities for associates.”

The partnership enhances Busey’s existing deposit, commercial banking and wealth management presence in the Chicago-Naperville-Elgin, IL-IN-WI Metropolitan Statistical Area (MSA). Through this transaction, Busey’s deposit share ranking in DuPage and Will Counties improves to #4 while our share in the Chicago MSA improves to #8 (based on 2023 FDIC Summary of Deposits data and excluding large financial institutions with $100 billion+ in assets). Additionally, this partnership solidifies Busey Bank’s position as #13 in total deposit market share across the state of Illinois and #4 in deposit share for banks headquartered in Illinois.

M&M Bank was founded in 1969 as a locally-owned bank valuing its roles and responsibilities as a community bank, bringing a focused expertise in business banking. M&M Bank continues to be dedicated to its founding principles by being actively involved in the communities it serves and providing unparalleled service delivered by experienced local professionals. As of December 31, 2023, M&M Bank had total consolidated assets of $0.5 billion, total loans of $0.4 billion and total deposits of $0.4 billion.

M&M Chief Executive Officer and Director Brad W. Butler shared, “Thanks to talented associates, both Busey and M&M have proven successful in providing premier customer service while building and maintaining strong generational relationships with those we serve. We are thrilled M&M Bank customers will continue to experience service excellence with the bankers they know and trust, while benefiting from expanded banking products and Busey’s extensive service center footprint across Illinois, Missouri, Florida and Indiana.”

Both companies support and value an engaged and empowered workforce and are committed to building a premier, service-oriented, community banking experience. Busey has been named among American Banker’s Best Banks to Work For since 2016; voted as one of the Best Places to Work in Illinois by associates since 2016; listed among 2022 and 2023’s America’s Best Banks by Forbes—in addition to various wellness, training and development, philanthropic and other workplace awards. We are honored to be consistently recognized nationally and locally for our engaged culture of integrity and commitment to community development.

Barack Ferrazzano Kirschbaum & Nagelberg LLP served as legal counsel to Busey. ArentFox Schiff LLP served as legal counsel and Keefe, Bruyette & Woods, Inc., a Stifel Company served as financial advisor to M&M.

About First Busey Corporation
As of December 31, 2023, First Busey Corporation (Nasdaq: BUSE) was a $12.28 billion financial holding company headquartered in Champaign, Illinois. Busey Bank, a wholly-owned bank subsidiary of First Busey Corporation, had total assets of $12.25 billion as of December 31, 2023, and is headquartered in Champaign, Illinois. Busey Bank currently has 58 banking centers, with 21 in the Central Illinois markets of Champaign, Peoria, Bloomington, and Decatur, 13 in suburban Chicago markets, 20 in the St. Louis metropolitan area, 1 in Indianapolis and 3 in southwest Florida. More information about Busey Bank can be found at busey.com.

Through Busey’s Wealth Management division, Busey Bank provides a full range of asset management, investment, brokerage, fiduciary, philanthropic advisory, tax preparation, and farm management services to individuals, businesses, and foundations. Assets under care totaled $12.14 billion as of December 31, 2023. More information about Busey’s Wealth Management services can be found at busey.com/wealthmanagement.

Busey Bank’s wholly-owned subsidiary, FirsTech Inc. (“FirsTech”), specializes in the evolving financial technology needs of small and medium-sized businesses, highly regulated enterprise industries, and financial institutions. FirsTech provides comprehensive and innovative payment technology solutions including online, mobile, and voice-recognition bill payments; money and data movement; merchant services; direct debit services; lockbox remittance processing for payments made by mail; and walk-in payments at retail agents. Additionally, FirsTech simplifies client workflows through integrations enabling support with billing, reconciliation, bill reminders, and treasury services. More information about FirsTech can be found at firstechpayments.com.

About Merchants and Manufacturers Bank
M&M Bank is a wholly-owned bank subsidiary of First Busey Corporation acquired in the merger. Headquartered in Joliet, Illinois, M&M Bank has several locations in the Chicago-Naperville-Elgin, IL-IN-WI Metropolitan Statistical Area (MSA). M&M Bank focuses on serving privately held manufacturers and distributors and select service businesses, particularly in the Greater Chicago area. M&M Bank provides a range of financial services and has developed a unique Life Equity Loan® program. For more information, visit m-mbank.com.

Contacts
Jeffrey D. Jones, EVP & CFO First Busey Corporation (217) 365-4500 jeff.jones@busey.com	Amy L. Randolph, EVP & COO First Busey Corporation (217) 365-4500 amy.randolph@busey.com

Special Note Concerning Forward-Looking Statements
This document may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance, and business of First Busey Corporation (“Busey”). Forward-looking statements, which may be based upon beliefs, expectations and assumptions of Busey’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and Busey undertakes no obligation to update any statement in light of new information or future events. A number of factors, many of which are beyond the ability of Busey to control or predict, could cause actual results to differ materially from those in any forward-looking statements.

These factors include, among others, the following: (1) the strength of the local, state, national, and international economy (including effects of inflationary pressures and supply chain constraints); (2) the economic impact of any future terrorist threats or attacks, widespread disease or pandemics (including the Coronavirus Disease 2019 pandemic), or other adverse external events that could cause economic deterioration or instability in credit markets (including Russia’s invasion of Ukraine and the Israeli-Palestinian conflict); (3) changes in state and federal laws, regulations, and governmental policies concerning Busey's general business (including changes in response to the recent failures of other banks); (4) changes in accounting policies and practices; (5) changes in interest rates and prepayment rates of Busey’s assets (including the impact of the London Interbank Offered Rate phase-out and the recent and potential additional rate increases by the Federal Reserve); (6) increased competition in the financial services sector (including from non-bank competitors such as credit unions and fintech companies) and the inability to attract new customers; (7) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (8) the loss of key executives or associates; (9) changes in consumer spending; (10) unexpected results of acquisitions, including the acquisition of Merchants and Manufacturers Bank Corporation; (11) unexpected outcomes of existing or new litigation involving Busey; (12) fluctuations in the value of securities held in Busey’s securities portfolio; (13) concentrations within Busey’s loan portfolio, large loans to certain borrowers, and large deposits from certain clients; (14) the concentration of large deposits from certain clients who have balances above current FDIC insurance limits and may withdraw deposits to diversify their exposure; (15) the level of non-performing assets on Busey’s balance sheets; (16) interruptions involving information technology and communications systems or third-party servicers; (17) breaches or failures of information security controls or cybersecurity-related incidents; and (18) the economic impact of exceptional weather occurrences such as tornadoes, hurricanes, floods, blizzards, and droughts. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.

Additional information concerning Busey and its business, including additional factors that could materially affect Busey’s financial results, is included in Busey’s filings with the Securities and Exchange Commission.

 

FAQ

What is the ticker symbol for First Busey ?

The ticker symbol for First Busey is 'BUSE'.

When was the acquisition of Merchants and Manufacturers Bank announced?

The acquisition of Merchants and Manufacturers Bank was announced on November 27, 2023.

What options did M&M shareholders have at the time of the merger?

At the time of the merger, M&M shareholders could choose to receive $117.74 in cash, 5.7294 shares of Busey common stock, or a combination of $34.55 in cash and 4.0481 shares of Busey common stock.

When is the merger of M&M Bank with Busey Bank expected to occur?

The merger of M&M Bank with Busey Bank is expected to occur in June 2024.

What is the total consideration for the acquisition?

The total consideration for the acquisition consists of approximately $12.2 million in cash and 1,429,324 shares of Busey common stock.