CapStar Bank, The First National Bank of Manchester, and The Bank of Waynesboro agree to merge

CapStar Financial Holdings, Inc. (“CapStar”) (NASDAQ: CSTR), the parent company of CapStar Bank, announced today the signing of definitive merger agreements with FCB Corporation (“FCB”), its wholly owned subsidiary The First National Bank of Manchester (“FNBM”), and The Bank of Waynesboro (“BOW”) providing for FCB to merge with and into CapStar and for FNBM and BOW to merge with and into CapStar Bank.  As of December 31, 2019, FCB and BOW had total combined assets of $467 million. Upon completion of the transaction, CapStar is expected to have total consolidated assets of approximately $2.5 billion.

“We are pleased to join forces with these outstanding organizations whom have proudly served their communities for over 115 years and rank among Tennessee’s highest performers on Net Interest Margin and Return on Assets,” said Timothy K. Schools, President and CEO of CapStar. “This strategic partnership will mutually benefit each of the companies’ employees, customers, and shareholders.  Importantly, the combination continues to strengthen CapStar’s funding capabilities while providing more granular and higher-yielding loan opportunities; deepens our local banking efforts in dynamic Middle Tennessee offering access into the fast-growing Rutherford County market; and creates additional scale allowing us to serve larger relationships, diversify our risks, and increase shareholder value and liquidity.  We look forward to working with First National Bank and Bank of Waynesboro employees and serving their customers and communities.”

Under the terms of the merger agreements, FCB and BOW shareholders will receive 3,634,218 CapStar common shares and $26.4 million in cash, subject to certain adjustments, totaling $85.1 million based on the closing price of CapStar’s common stock on January 22, 2020.  CapStar expects the transaction to be approximately 5% and 14% accretive to earnings per common share in 2020 and 2021, respectively, and tangible book value per share dilution that is anticipated to be earned back in less than three years. Pending regulatory and shareholder approvals and the satisfaction of certain other customary closing conditions, the acquisition is expected to be finalized in late second or early third quarter of 2020.

“We are excited to partner with CapStar”, said Timothy L. Spry, President and Chief Executive Officer of The First National Bank of Manchester. “In their recent partnership with Athens Federal, CapStar demonstrated a deep commitment to their employees, customers, and local community.  We believe this combination will better align our resources, expand our product offerings and technology solutions, and enhance our financial strength allowing us to better serve our markets.”

“CapStar is the very best partner for us to create the most trusted community bank in the communities we serve,” said William B. Bryant, President and CEO of The Bank of Waynesboro. “With Ken Webb and other members of their team being from South Central, Tennessee, CapStar has unique local knowledge of our markets and will help us continue to provide outstanding customer service to our existing customers as well as expand our reach to new customers in bigger and better ways.”

Keefe, Bruyette & Woods, Inc. served as financial advisor and Wachtell, Lipton, Rosen, & Katz served as legal advisor to CapStar.  ProBank Austin served as financial advisor and Butler Snow LLP served as legal advisor to FCB.  Mercer Capital rendered a fairness opinion to the special committee of the board of directors of BOW.

In addition to the information contained within this press release, an investor presentation has been posted to CapStar’s website (

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