The banks take another turn on the M&A wheel that continues to spin in areas affecting wealth management in North America.

Iowa-based Heartland Financial USA has agreed to acquire Minnesota-headquartered Signature Bancshares, parent of Signature Bank - which provides private banking and other services - for about $53.4 million, based on closing stock prices on November 10.

The acquisition is Heartland’s 20th acquisition since 1994, and its 13th transaction in the past six years, it said in a statement yesterday. 

Signature Bank is a commercial and private bank, headquartered in Minnetonka, MN, with about $390 million in total assets, $326 million in net loans outstanding and $339 million in deposits as of September 30, 2017.  

Running alongside the merger deal, Signature Bank will merge with and into Heartland’s Minnesota-based subsidiary, Minnesota Bank & Trust. These entities will have over $600 million in combined assets and operate as one of Heartland’s locally managed subsidiary banks. 

Once the transaction is complete, the combined organizations will operate under the Minnesota Bank & Trust brand name. After the closing of the acquisition of Signature, Heartland will have 118 full-service banking locations operating across 12 states.

Terms of the agreement unanimously approved by the boards of directors of Heartland and Signature. Signature common shareholders will receive 0.0610 shares of Heartland common stock (approximately 922,100 Heartland shares in the aggregate) and $0.335 in cash for each share of Signature common stock, subject to certain adjustments. Signature option holders will receive cash or Heartland common stock, at the election of the holder, for the in-the-money portion of the Signature stock options.

The transaction is subject to approval by bank regulators and the Signature shareholders. The transaction is expected to close in the first quarter of 2018 with a systems conversion planned for the second quarter of 2018.

Panoramic Capital Advisors served as financial advisor to Heartland and Dorsey & Whitney LLP served as Heartland’s legal advisor. Sheshunoff & Co Investment Banking served as financial advisor and issued a Fairness Opinion to Signature and Winthrop & Weinstine, PA  served as Signature’s legal advisor.