Old National Bancorp (NASDAQ: ONB) (“Old National”) and CapStar
Financial Holdings, Inc. (NASDAQ: CSTR) (“CapStar”) jointly
announced today that they have entered into a definitive merger
agreement for Old National to acquire CapStar in an all-stock
transaction. Combining the two organizations will strengthen Old
National’s recently formed Nashville presence and add several new
high-growth markets.
Old National entered the Tennessee market in 2022 when it
introduced a Nashville-based 1834 Wealth team (Old National’s
high-net-worth division). More recently, Old National added a
Nashville-based Commercial banking and lending team. The
combination with CapStar accelerates Old National’s Tennessee
presence bringing $3.3 billion in total assets, $2.3 billion in
total loans, and $2.8 billion in deposits as of September 30, 2023,
with top-10 deposit market share in the Nashville MSA and recent
entry into Asheville, North Carolina.
“This partnership with CapStar – one of the most highly
respected and successful community banks in Tennessee – is a
tremendous cultural fit and a natural extension of our growth
strategy,” said Old National CEO Jim Ryan. “By establishing a
full-service banking presence in Nashville and several other strong
Tennessee and North Carolina communities, we can more fully serve
our existing Nashville-area clients while also introducing our
client- and community-focused brand of banking to the surrounding
region.”
“Over the past five years, our team has repositioned CapStar,
strengthening its performance and long-term prospects,” said
Timothy K. Schools, CapStar President and Chief Executive
Officer. “In looking to the next five years, it is my belief
Old National’s like-minded culture and scale best positions our
employees, customers, and shareholders to continue our positive
momentum. Excitingly, CapStar employees will be a major contributor
to strengthen Old National’s recent entry into Nashville. Old
National has hired market-leading individuals we are well familiar
with, and shareholders greatly benefit from a material increase in
dividends and daily trading volume while receiving a very
attractively priced stock with strong potential for upside.”
North Carolina and Tennessee ranked first and third in CNBC’s
2023 annual ranking of America’s Top States for Business. CapStar’s
markets include four of the fastest growing metro areas across the
Southeast, of which Nashville is one of the 25 fastest in the
United States. CapStar’s financial performance ranks first among
all Tennessee-based banks and fourth across the Southeast within
S&P Global Market Intelligence’s ranking of banks with assets
of $3 to $10 billion.
Additionally, CapStar has been recognized as the
highest-performing publicly traded Tennessee-based bank by Bank
Director each of the past three years.
The partnership transaction includes 23 total banking centers in
the following locations:
- Nashville MSA – 7 locations
- Athens, TN – 2 locations
- Wayne County, TN – 3 locations
- Lawrence County, TN – 2 locations
- Monroe County, TN – 2 locations
- Coffee County, TN – 2 locations
- Etowah, TN – 1 location
- Cleveland, TN – 1 location
- Chattanooga, TN – 1 location
- Knoxville, TN – 1 location
- Asheville, NC – 1 location
Under the terms of the merger agreement, each outstanding share
of CapStar common stock will be converted into the right to receive
1.155 shares of Old National common stock, valuing the transaction
at approximately $344.4 million, or $16.64 per share, based on Old
National’s 30-day volume weighted average closing stock price
ending October 25, 2023. The definitive merger agreement has been
approved by the Board of Directors of each company. The transaction
remains subject to regulatory approval and the vote of CapStar
shareholders. The transaction is anticipated to close in the second
quarter of 2024.
Keefe, Bruyette & Woods, A Stifel Company, served as
financial advisor and Dykema Gossett, PLLC acted as legal advisor
to Old National.
Morgan Stanley & Co. LLC served as financial advisor and
Wachtell, Lipton, Rosen & Katz acted as legal advisor to
CapStar.
CONFERENCE CALL AND WEBCASTOld National will hold a conference
call and live webcast at 4:00 p.m. Central Time on Thursday,
October 26, 2023, to discuss the acquisition of CapStar Financial
Holdings, Inc. The live audio webcast link and corresponding
presentation slides will be available on the Company’s Investor
Relations web page at oldnational.com and will be archived there
for 12 months. To listen to the live conference call, dial U.S.
(888) 300-3045 or International (646) 568-1027, Conference ID Code
7918950. A replay of the call will also be available from
approximately 8:00 a.m. Central Time on October 27 through November
10. To access the replay, dial U.S. (800) 770-2030 or International
(647) 362-9199, Conference ID Code 7918950.
ABOUT OLD NATIONALOld National Bancorp is the holding company of
Old National Bank, which is the sixth largest commercial bank
headquartered in the Midwest. With approximately $49 billion of
assets and $28 billion of assets under management, Old National
ranks among the top 30 banking companies headquartered in the U.S.
Tracing our roots to 1834, Old National Bank has focused on
community banking by building long-term, highly valued partnerships
with clients and in the communities it serves. In addition to
providing extensive services in retail and commercial banking, Old
National offers comprehensive wealth management, investment, and
capital market services. For more information and financial data,
please visit Investor Relations at oldnational.com.
ABOUT CAPSTARCapStar Bank, with assets of $3.3 billion, provides
a relationship-based and highly personal banking experience to
small to mid-sized private businesses, professionals, and
individuals. Focused on delivering superior flexibility,
responsiveness, and customer service, CapStar serves customers
through highly-skilled employees, digital channels, as well as 23
financial centers across 13 Tennessee counties. For more
information about CapStar, please visit capstarbank.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTSThis release
contains “forward-looking statements” within the meaning of the
safe harbor provisions of the U.S. Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. In general, forward-looking statements can be identified
through use of words such as “may,” “believe,” “expect,”
“anticipate,” “intend,” “will,” “should,” “plan,” “estimate,”
“predict,” “continue” and “potential” or the negative of these
terms or other comparable terminology, and include statements
related to the expected timing, completion, financial benefits, and
other effects of the proposed merger of CapStar with and into Old
National (the “Merger”). Forward-looking statements are not
historical facts and represent management’s beliefs, based upon
information available at the time the statements are made, with
regard to the matters addressed; they are not guarantees of future
performance. Actual results may prove to be materially different
from the results expressed or implied by the forward-looking
statements. Forward-looking statements are subject to numerous
assumptions, risks and uncertainties that change over time and
could cause actual results or financial conditions to differ
materially from those expressed in or implied by such
statements.
Factors that could cause or contribute to such differences
include, but are not limited to, (1) expected cost savings,
synergies and other financial benefits from the Merger not being
realized within the expected time frames and costs or difficulties
relating to integration matters being greater than expected, (2)
the ability of CapStar to obtain the necessary approval by its
shareholders, (3) the ability of Old National and CapStar to obtain
required governmental approvals of the Merger, and (4) the failure
of the closing conditions in the definitive merger agreement to be
satisfied, or any unexpected delay in closing the Merger. Further
information regarding additional factors that could affect the
forward-looking statements can be found in the cautionary language
included under the headings “Forward-Looking Statements” (in the
case of Old National), “Cautionary Note Regarding Forward-Looking
Statements” (in the case of CapStar), and “Risk Factors” in Old
National’s and CapStar’s Annual Reports on Form 10-K for the year
ended December 31, 2022, and other documents subsequently filed by
Old National and CapStar with the Securities and Exchange
Commission (“SEC”).
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed Merger, Old National will file
with the SEC a Registration Statement on Form S-4 that will include
a Proxy Statement of CapStar and a Prospectus of Old National, as
well as other relevant documents concerning the proposed
transaction. Investors and security holders, prior to making any
investment or voting decision, are urged to read the registration
statement and proxy statement/prospectus when it becomes available
(and any other documents filed with the SEC in connection with the
Merger or incorporated by reference into the proxy
statement/prospectus) because such documents will contain important
information regarding the proposed merger.
Investors and security holders may obtain free copies of these
documents and other documents filed with the SEC on its website at
www.sec.gov. Investors and security holders may also obtain free
copies of the documents filed with the SEC by (i) Old National on
its website at
https://ir.oldnational.com/financials/sec-filings/default.aspx, and
(ii) CapStar on its website at
https://ir.capstarbank.com/financial-information/sec-filings.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation, or sale would
be unlawful prior to registration or qualification under the
securities laws of such jurisdiction.
PARTICIPANTS IN THE SOLICITATION
Old National, CapStar and certain of their directors and
executive officers may be deemed participants in the solicitation
of proxies from shareholders of CapStar in connection with the
proposed Merger. Information regarding the directors and executive
officers of Old National and CapStar and other persons who may be
deemed participants in the solicitation of the shareholders of
CapStar in connection with the proposed Merger will be included in
the proxy statement/prospectus for CapStar’s special meeting of
shareholders, which will be filed by Old National with the SEC.
Information about the directors and officers of Old National and
their ownership of Old National’s common stock can be found in Old
National’s definitive proxy statement in connection with its 2023
annual meeting of shareholders, as filed with the SEC on March 30,
2023, and other documents subsequently filed by Old National with
the SEC. Information about the directors and officers of CapStar
and their ownership of CapStar’s common stock can be found in
CapStar’s definitive proxy statement in connection with its 2023
annual meeting of shareholders, as filed with the SEC on March 10,
2023, and other documents subsequently filed by CapStar with the
SEC. Additional information regarding the interests of such
participants will be included in the proxy statement/prospectus and
other relevant documents regarding the proposed Merger filed with
the SEC when they become available.
Old National Contacts:Media: Rick Vach (904)
535-9489Investors: Lynell Durchholz (812) 464-1366
CapStar Contact:Michael J. Fowler (615)
732-7404
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