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First Community will acquire Peoples Bank of Virginia

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First Community Bancshares, Inc. (Nasdaq:FCBC) and Peoples Bank of Virginia jointly announced the signing of a definitive merger agreement under which First Community will acquire Peoples for a total valuation of approximately $40.6 million.

Peoples Bank of Virginia was established in 2002, operates four branches in the Richmond, Virginia MSA, and as of December 31, 2011, had $286 million in assets, $181 million in loans, $246 million in deposits and $39 million in common equity. The combined company will become the 10th largest Virginia-based bank in the Richmond MSA.

John Mendez, President and Chief Executive Officer of First Community, stated, “We are pleased to be joining forces with Peoples Bank of Virginia and their exceptional banking team to expand our operations in the growth markets in and around Richmond, Virginia, and Henrico, Chesterfield and Hanover counties. Our merger is the result of extensive due diligence, and we are confident that this partnership will create tremendous value for both of our companies’ clients, employees and shareholders. Jim Atkinson and his team have built a strong, well-capitalized and profitable franchise in one of the most attractive banking markets in the United States.”


James H. “Jim” Atkinson, Jr., Chief Executive Officer of Peoples Bank of Virginia, commented, “We are excited to be partnering with First Community, one of the best banks in the Commonwealth. The combination of Peoples Bank of Virginia’s foothold in the Richmond market and First Community’s leadership, strong operating performance, and more extensive product offerings creates an outstanding opportunity for our customers, employees and shareholders.”

Following the merger Jim Atkinson and Quentin L. Corbett will remain involved in the operation supporting the continued growth of the combined franchise in the market. William H. “Bill” Pruitt will also join the board of directors for First Community Bank and Marshall E. “Eddie” McCall Jr. will assume the position of Vice President and Richmond City Executive joining Richard D. Ocheltree, Regional President for Eastern Virginia. Mendez added, “The consolidation of these two teams in the Richmond market creates a premier community banking franchise with outstanding capabilities in retail, commercial, business and real estate banking. This also sets the stage for expansion of our First Community Wealth Management and Insurance Services in the Richmond area.”

Under the terms of the merger agreement, which has been unanimously approved by the boards of directors of both companies, shareholders of Peoples will receive $6.08 per share in cash and 1.07 First Community shares for each common share of Peoples. First Community expects the transaction to be accretive to earnings in the first full year of the combination. It is anticipated that the transaction will be consummated in the second or third quarter of 2012, after receipt of regulatory approvals, the approval of Peoples shareholders, and other closing conditions.

Sandler O’Neill + Partners, L.P. served as financial advisor to First Community and Davenport & Co. served as financial advisor to Peoples Bank of Virginia. Legal counsel was provided by Bowles, Rice, McDavid, Graff and Love, Charleston, West Virginia, and LeClairRyan, Richmond, Virginia.

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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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