Updated 4 p.m. July 25: This story has been updated with information from an afternoon news conference.
American National Bankshares, the Danville-based parent company of American National Bank & Trust Co., has agreed to be acquired by Richmond-based Atlantic Union Bankshares Corp., the companies jointly announced Tuesday.
The deal is valued at approximately $416.8 million, or $39.23 per share, as each share of American National stock (NASDAQ:AMNB) would be converted to a right to receive 1.35 shares of Atlantic Union stock (NYSE:AUB), according to a news release.
The acquisition is expected to be complete in the first quarter of next year, subject to approval from regulators and American National shareholders. The combined firm would have $23.7 billion in total assets, $19.1 billion in total deposits and $17.3 billion in gross loans.
“I believe we are bringing together two of the best banks in Virginia to realize tremendous opportunities,” American National Bankshares President and CEO Jeff Haley said in the news release. “And at the root of this partnership are two solid banks with very compatible cultures which ultimately will make us stronger together.”
Atlantic Union is the holding company for Atlantic Union Bank, which has $20.6 billion in total assets and operates 109 branches and 125 ATMs in Virginia, Maryland and North Carolina.
American National Bankshares is the parent company of American National Bank & Trust Co., which has $3.1 billion in total assets and 26 offices across Virginia and North Carolina.
“We expect that our combined footprint will bring additional convenience to our customers and position us as an even stronger competitor against the large national, super-regional and smaller community banks,” Atlantic Union President and CEO John Asbury said in the news release. “Increasing our presence in Roanoke and entering Southside Virginia will further build out our Virginia franchise and the transaction will also allow us to gain meaningful entry into North Carolina’s attractive Piedmont Triad region and Raleigh.”
On a Zoom-based press conference Tuesday, Asbury said American National customers likely won’t notice a difference until around May, when the bank switches customers to Atlantic Union’s online banking software and other computer systems.
Asbury said officials are still assessing whether bank branches will close due to the merger but noted that the two companies’ branch locations “only overlap in certain limited circumstances.”
Haley pointed to an increase in customers’ usage of mobile banking and other digital technologies, along with a corresponding decline in branch foot traffic, as one key factor behind the merger. He said that 85% of American National’s transactions now are performed digitally.
“The industry is closing branches. But that’s not what this is about, because there’s only 15% going in our doors right now,” Haley said.
Some employees’ jobs will be impacted by the merger — Asbury said it was the “unfortunate reality” of a business combination such as this merger. He said that assessment will happen over the next several months.
“There will be some job impacts in certain support areas. Exactly what that is, is yet to be determined,” Asbury said.
Haley said American National employs about 375 people total, of whom about 125 are in Danville.
After the merger, American National board members Nancy Howell Agee, CEO of Carilion Clinic, and Joel Shepherd, president of Virginia Home Furnishings, would join Atlantic Union’s board.
Haley, the American National CEO, would help integrate the two companies, advise on the combined bank’s regional community banking model in American National’s existing markets and serve as the bank’s representative to two Danville-based charitable trusts, according to the news release.
The deal between Atlantic Union and American National marks the second acquisition of a Danville-based bank company within three years.
In November 2020, Altavista-based Pinnacle Bankshares Corp., parent company of First National Bank, completed its acquisition of Virginia Bank Bankshares, the parent company of Virginia Bank and Trust. That deal created a larger First National Bank with total assets of $703 million at that time.
Shares of American National closed Tuesday up 21% at $38.35. Shares of Atlantic Union closed down 4% at $29.69.
