First Interstate Bank and Great Western Bank to merge
BILLINGS, MT– First Interstate BancSystem, Inc. (NASDAQ: FIBK) (“FIBK”), parent company of First Interstate Bank, and Great Western Bancorp, Inc. (NYSE: GWB) (“GWB”), parent company of Great Western Bank, announced Thursday they have entered into a definitive agreement under which the companies will combine in an all-stock transaction.
Under the terms of the agreement, which was unanimously approved by both companies’ Boards of Directors, GWB will merge into FIBK and the combined holding company and bank will operate under the First Interstate name and brand with the company’s headquarters remaining in Billings, Montana. First Interstate will maintain a strong presence in GWB’s headquarters of Sioux Falls, South Dakota.
The combined company leverages the strengths of both organizations, creating a diversified, community-focused banking franchise. Once the conversion is complete, First Interstate will be one of the region’s largest financial institutions, with over $32 billion in assets and more than 300 branches across 14 states.
“This is a transformative moment for our 53-year-old company,” said FIBK President and CEO Kevin Riley. “The strategic and cultural alignment between our organizations is what makes this transaction so exciting, as we both pride ourselves on being community banks with a strong focus on relationship building, customer service, and community outreach. We are eager to expand our community banking model into eight new states and look forward to building relationships with the employees and clients who call these beautiful regions home.”
Pending regulatory and shareholder approvals, the transaction is expected to close during the first calendar quarter of 2022. The conversion of GWB branches to First Interstate Bank is expected to take place during the second calendar quarter of 2022.
“We’re excited to join forces, and confident that both companies’ stakeholders will benefit from this partnership,” said Mark Borrecco, GWB president and CEO. “We’ll be able to offer customers access to additional branch locations and new products and services, provide new growth and professional development opportunities to our employees, deliver additional returns to our shareholders, and have an even greater impact on our communities.”
Upon close of the transaction, five directors from GWB will join the FIBK Board of Directors. FIBK’s existing dual-class stock structure will sunset at the record date of FIBK’s next annual shareholder meeting. At that time, existing FIBK Class B common stock will be converted 1:1 into Class A common stock and FIBK will no longer be a controlled company.
“Throughout our many years of ownership, we have prided ourselves on the ability to stay true to our values and roots while simultaneously adapting, innovating, and responding to the unique needs of our clients and communities,” said Jim Scott, Director of the Board for FIBK and son of First Interstate’s founders, Homer Scott, Sr. and Mildred Scott. “This combination is an extension of our legacy in the region where our family’s roots began. It increases the Bank’s community commitment while expanding our brand of community banking.”
The Scott family will remain significant shareholders in FIBK and family members will continue to serve in Board positions post-transaction.
To punctuate the milestone moment for the Company and to celebrate the Scott family’s legacy, as part this transaction, FIBK will gift over $20 million to the First Interstate BancSystem Foundation.
“Who First Interstate is as an organization and the successes we’ve enjoyed are due in large part to the leadership, support, and vision of Scott family members,” Riley said. “These funds will ensure that our shared passion for giving back to the places we call home not only continues in our existing communities but extends into our new communities in meaningful and relevant ways.”