UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________

Form 8-K
_____________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event Reported): June 29, 2018  

Home BancShares, Inc.
(Exact Name of Registrant as Specified in Charter)

Arkansas 000-51904 71-0682831
(State or Other Jurisdiction of Incorporation) (Commission File Number) (I.R.S. Employer Identification Number)

 

719 Harkrider, Suite 100, Conway, Arkansas 72032
(Address of Principal Executive Offices) (Zip Code)

(501) 339-2929
(Registrant's telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

  [   ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
  [   ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
  [   ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
  [   ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company [   ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [   ]

 
 

Item 7.01. Regulation FD Disclosure.

     On July 2, 2018, Home BancShares, Inc. (the “Company”), parent company of Centennial Bank, (“Centennial”), issued a press release announcing the acquisition of Shore Premier Finance (“SPF”), a division of Union Bank & Trust of Richmond, Virginia (“Union”), the bank subsidiary of Union Bankshares Corporation (NASDAQ: UBSH). Copies of the press release and certain additional information regarding the transaction are attached as Exhibits 99.1 and 99.2 to this Current Report.

     As provided in General Instruction B.2 to Form 8-K, the information furnished in Exhibits 99.1 and 99.2 to this Current Report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and such information shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 8.01. Other Events.

     On June 29, 2018, the Company entered into an agreement with Union to purchase substantially all of the assets and certain specific liabilities of Union’s Shore Premier Finance division, consisting primarily of marine loans totaling approximately $383.4 million, for a purchase price consisting of approximately $374.5 million in cash, subject to certain post-closing adjustments, and 1,250,000 shares of the Company’s common stock.  The purchase of the loans was completed on June 29, 2018 and became effective at the end of the day on June 30, 2018.  The portfolio of loans will now be housed in a division of Centennial Bank know as Shore Premier Finance. The Shore Premier Finance division of Centennial Bank will be responsible for servicing the acquired loan portfolio and originating new loan production.  In connection with this acquisition of loans, Centennial Bank has notified the Arkansas State Bank Department that it plans to establish a new loan production office in Chesapeake, Virginia.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1   Press Release: Home BancShares Announces Acquisition of Loan Portfolio and Creation of Marine Finance Division.    
99.2   Supplemental materials to Press Release dated July 2, 2018.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

  Home BancShares, Inc.
     
   
Date: July 2, 2018 By:  /s/ Jennifer C. Floyd        
    Jennifer C. Floyd
    Chief Accounting Officer
   

EXHIBIT 99.1

Home BancShares, Inc. Announces Acquisition of Loan Portfolio and Creation of Marine Finance Division

CONWAY, Ark., July 02, 2018 (GLOBE NEWSWIRE) -- Home BancShares, Inc. (NASDAQ:HOMB) (“Home” or the “Company”), parent company of Centennial Bank, (“Centennial”), today announced the acquisition of Shore Premier Finance (“SPF”), a division of Union Bank & Trust of Richmond, Virginia (“Union”), the bank subsidiary of Union Bankshares Corporation (NASDAQ:UBSH), effective as of the end of the day on June 30, 2018. Under the terms of the agreement, Union received proceeds from the transaction consisting of approximately $374.5 million in cash, subject to certain post-closing adjustments, and 1,250,000 shares of Home common stock. 

Shore Premier Finance currently provides direct consumer financing to United States Coast Guard (“USCG”) registered high-end sail and power boats.  Additionally, SPF provides inventory floor plan lines of credit to marine dealers, primarily those selling USCG documented vessels.  As of the closing of the acquisition, SPF had approximately $384.2 million in total assets, including $383.4 million in total loans.  

This portfolio of loans will now be housed in a division of Centennial known as Shore Premier Finance.  The Shore Premier Finance division of Centennial will be responsible for servicing the acquired loan portfolio and originating new loan production.

“We’re always looking at acquisition opportunities to provide the strongest risk adjusted return for our investors,” said John Allison, Home’s Chairman.  “The Shore Premier Finance team has built a solid foundation in the marine finance space and we look forward to providing them the opportunity and resources to further develop that brand.”

“Divesting our national scope marine finance business obtained in the recent Xenith Bank acquisition, known as Shore Premier Finance, better enables Union to focus on our core businesses and execute our strategic priorities,” said John C. Asbury, president and CEO of Union Bankshares Corporation.  “Our teammates built a solid reputation in this specialty lending category at Shore Premier and will find a welcoming home at Centennial Bank.”

“This marine loan portfolio provides both geographic and collateral-type diversification for the Company,” said Tracy French, Centennial’s Chief Executive Officer.  “We envision this being the foundation of a meaningful presence in the marine financing market for Home.”

In connection with this acquisition and the creation of the Shore Premier Finance division of Centennial, Centennial has notified the Arkansas State Bank Department of its plans to establish a new loan production office in Chesapeake, Virginia.  The loan production office is anticipated to open in July 2018, pending confirmation of no objection.  Once the loan production office has been established, the Shore Premier Finance division of Centennial will continue its vision to build out a national lending platform focusing on commercial and consumer marine loans.  

Additional information regarding the acquisition is provided in a supplemental presentation available on the Company's website at www.homebancshares.com, under the “Investor Relations” section.

General

Home BancShares, Inc. is a bank holding company, headquartered in Conway, Arkansas. Its wholly-owned subsidiary, Centennial Bank, provides a broad range of commercial and retail banking plus related financial services to businesses, real estate developers, investors, individuals and municipalities. Centennial Bank has branch locations in Arkansas, Florida, South Alabama and New York City. The Company’s common stock is traded through the NASDAQ Global Select Market under the symbol “HOMB.”

Headquartered in Richmond, Virginia, Union Bankshares Corporation (NASDAQ:UBSH) is the holding company for Union Bank & Trust, which has 147 branches, 7 of which are operated as Xenith Bank, a division of Union Bank & Trust of Richmond, Virginia, and approximately 216 ATMs located throughout Virginia and in portions of Maryland and North Carolina.  Non-bank affiliates of the holding company include: Old Dominion Capital Management, Inc. and Dixon, Hubard, Feinour, & Brown, Inc., which both provide investment advisory services, and Union Insurance Group, LLC, which offers various lines of insurance products.

This release contains forward-looking statements which include, but are not limited to, statements about the benefits of the Company’s acquisition of SPF, including the Company’s plans, expectations, goals and outlook for the future. Statements in this press release that are not historical facts should be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements of this type speak only as of the date of this news release. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors could cause actual results to differ materially from those contemplated by the forward-looking statements, including, but not limited to, (i) the risk that the benefits from the transaction may not be fully realized or may take longer to realize than expected, including as a result of any delay in or failure to receive regulatory approval of the proposed loan production office through which SPF will be operated, changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which the Company and SPF operate; (ii) the ability to promptly and effectively integrate the business of SFP into the Company; (iii) the reaction to the transaction of the Company’s and SPF’s customers, employees and counterparties; and (iv) diversion of management time on acquisition-related issues. Additional information on factors that might affect the Company’s financial results is included in its Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on February 27, 2018.

FOR MORE INFORMATION CONTACT

Home BancShares, Inc.                                                   

Donna Townsell
Investor Relations Officer                       
(501) 328-4625                                  

Exhibit 99.2

 

NASDAQ: HOMB | July 2018 www.homebancshares.com

 

FORWARD LOOKING STATEMENT This presentation contains forward - looking statements which include, but are not limited to, statements about the benefits of the acquisition of the Shore Premier Finance (“SPF”) division of Union Bank & Trust by Home BancShares, Inc. (the “Company”) and its bank subsidiary, Centennial Bank, including the Company’s plans, expectations, goals and outlook for the future. Statements in this presentation that are not historical facts should be considered forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements of this type speak only as of the date of this presentation. By nature, forward - looking statements involve inherent risk and uncertainties. Various factors could cause actual results to differ materially from those contemplated by the forward - looking statements, including, but not limited to, ( i ) the risk that the benefits from the transaction may not be fully realized or may take longer to realize than expected, including as a result of any delay in or failure to receive regulatory approval of the proposed loan production office through which SPF will be operated, changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations and their enforcement, and the degree of competition in the geographic and business areas in which the Company and SPF operate; (ii) the ability to promptly and effectively integrate the business of SFP into the Company; (iii) the reaction to the transaction of the Company’s and SPF’s customers, employees and counterparties; and (iv) diversion of management time on acquisition - related issues. Additional information on factors that might affect Home’s financial results is included in its Annual Report on Form 10 - K for the year ended December 31, 2017, filed with the SEC on February 27, 2018. 2

 

TRANSACTION OVERVIEW Purchased substantially all assets and certain specific liabilities of Shore Premier Finance (“SPF”) from Union Bank & Trust at a 5% premium. Acquired approximately $383.4 million in consumer marine loans and dealer floor plan draws with a weighted average yield of 4.60%. The portfolio of loans will now be housed in a division of Centennial Bank known as Shore Premier Finance. 3

 

OVERVIEW OF SHORE PREMIER FINANCIAL Provides direct consumer loans to finance Coast Guard registered high - end sail and power boats. Referrals come from dealers and brokers. Provides inventory floor plan lines of credit to marine dealers. Total outstanding loans as of 12/31/17 were $365 million with an average loan balance of approximately $306,000 . $30 million in floor plan draws $335 million in consumer fundings Floor plan commitments peaked at $94 million in 2017 Originated $140 million of consumer loans in 2017. 4

 

STRATEGIC OPPORTUNITY Expands the specialty finance options currently offered. Centennial currently has 16 locations in Southeast Florida which is considered the “boating capital of the world.” Experienced lending team with proven track record, strong industry knowledge and established relationships with nationwide dealers and manufacturers will be retained. With the opening of the Chesapeake, VA loan production office, the division will continue its vision to build a national lending platform focused on commercial and consumer marine loans. 5

 

$0 $25 $50 $75 $100 $125 $150 $175 $200 $225 $250 $275 $300 $325 $350 $375 $400 '14 '15 '16 Q1 '17 Q2 '17 Q3 '17 Q4 '17 Q1 '18 $ 60 $ 147 $ 244 $ 275 $ 297 $ 317 $ 335 $ 353 SHORE FINANCIAL LOAN GROWTH DOLLARS IN MILLIONS 6

 

DEFAULT AND LOSS HISTORY 7 Cumulative losses of less than 1.0 % since 2010. Losses realized on SPF originated loans since 2013 are limited to $45K. Losses from purchased loans since 2012 have totaled $236K. 2010 2011 2012 2013 2014 2015 2016 2017 Defaults (by loan count) 1.6% 1.1% 2.3% 0.8% 0.9% 0.0% 0.3% 0.0% Losses (by dollars) 0.43% 0.13% 0.86% 0.05% 0.0% 0.0% 0.11% 0.0%

 

HISTORICAL ACQUISITIONS 8 Year Acquired Bank Acquisition Type Location Assets (1) 2003 Community Bank Market Cabot, AR $326 2005 Twin City Bank Market North Little Rock, AR $633 2005 Marine Bank Market Marathon, FL $258 2005 Bank of Mountain View Market Mountain View, AR $203 2008 Centennial Bank Market Little Rock, AR $234 2010 Old Southern Bank FDIC - assisted Orlando, FL $335 2010 Key West Bank FDIC - assisted Key West, FL $97 2010 Coastal Community Bank FDIC - assisted Panama City, FL $362 2010 Bayside Savings Bank FDIC - assisted Port Saint Joe, FL $63 2010 Wakulla Bank FDIC - assisted Crawfordville, FL $353 2010 Gulf State Community Bank FDIC - assisted Carrabelle, FL $112 2012 Vision Bank Selected Asset Purchase Panama City, FL $530 2012 Heritage Bank of Florida FDIC - assisted Lutz, FL $225 2012 Premier Bank § 363 Bankruptcy Tallahassee, FL $265 2013 Liberty Bancshares, Inc. Market Jonesboro, AR $2,819 2014 Florida Traditions Bank Market Dade City, FL $310 2014 Broward Financial Holdings, Inc. Market Ft. Lauderdale, FL $184 2015 Doral Bank Florida FDIC - assisted Panama City, FL $466 2015 Florida Business BancGroup, Inc. Market Tampa, FL $532 2017 Giant Holdings, Inc. Market Ft. Lauderdale, FL $395 2017 The Bank of Commerce § 363 Bankruptcy Sarasota, FL $183 2017 Stonegate Bank Market Pompano Beach, FL $2,887 2018 Shore Premier Financial Selected Asset Purchase Richmond, VA $384 (1) DOLLARS IN MILLIONS

 

TOTAL ASSETS POST ACQUISITION TOTAL PROFORMA ASSETS AS OF MARCH 31, 2018 9 $ 14.7 Billion Holding Company

 

SUMMARY Expands specialty finance options. Financially attractive transaction. Immediately accretable to EPS. 65.73% loan growth in 2016 and 37.54% loan growth in 2017. Cumulative loan losses historically below 1.0%. Acquisition is consistent with HOMB’s opportunistic strategy. Seamless integration expected. HOMB has formed a dedicated team to lead the integration process. Positive addition of experienced lending team with strong industry relationships. 10

 

CONTACT INFORMATION 11 Corporate Headquarters Home BancShares, Inc. 719 Harkrider Street, Suite 100 P.O. Box 966 Conway, AR 72033 Financial Information Donna Townsell Director of Investor Relations (501) 328 - 4625 Website www.homebancshares.com

 

NASDAQ: HOMB | July 2018 www.homebancshares.com