HENDERSON, Ky. (WEHT) – Old National Bancorp and CapStar Financial Holdings, Inc. jointly announced Thursday that they have entered into a definitive merger agreement for Old National to acquire CapStar in an all-stock transaction.
Officials say combining the two organizations will strengthen Old National’s recently formed Nashville presence and add several new high-growth markets.
“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.”
According to Old National Bancorp, 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.
Officials say the transaction is anticipated to close in the second quarter of 2024.