IBERIABANK Corporation Announces Agreement to Acquire Georgia Commerce Bancshares, Inc.

LAFAYETTE, La. and ATLANTA, Dec. 8, 2014 /PRNewswire/ -- IBERIABANK Corporation (NASDAQ: IBKC) ("IBKC"), holding company of the 127-year-old IBERIABANK (www.iberiabank.com) and Georgia Commerce Bancshares, Inc. ("Georgia Commerce"), holding company of Georgia Commerce Bank(www.gacommercebank.com) jointly announced today the signing of a definitive agreement for IBKC to acquire Georgia Commerce via merger.  The proposed merger of Georgia Commerce with and into IBKC has been approved by the Board of Directors of each company and is expected to close in the first half of 2015. Completion of the transaction is subject to customary closing conditions, including the receipt of required regulatory approvals and the approval of Georgia Commerce's shareholders.

Mark W. Tipton, Chairman and Chief Executive Officer of Georgia Commerce, will be named Executive Vice President and Georgia Regional President for IBERIABANK's Georgia franchise after the acquisition is consummated.  Rodney L. Hall, President of Georgia Commerce, will be named Executive Vice President and Atlanta Market President upon completion of the transaction.

Mark Tipton commented, "This is a very exciting day for our organization and our shareholders. We are proud to partner with an organization that mirrors our client relationship-focused approach to business and values local decision-making and community involvement. With IBERIABANK's history of strong financial performance, its size and scope, we will be in an exceptional position to take our clients, team and shareholders to the next level."

Daryl G. Byrd, President and Chief Executive Officer of IBKC, added, "We are very excited to have the opportunity to enter the Atlanta market by joining forces with Georgia Commerce. Mark Tipton, Rodney Hall and their team have done a phenomenal job building a Company that provides us a solid platform from which to grow our Georgia franchise. With a strong economic recovery in progress, Atlanta is one of the fastest growing regions contiguous to our current footprint. This is a market that our team knows very well and we believe we are entering this market at an opportune time.  Upon completion of our pending acquisitions, we will have $18.4 billion in total assets on a pro forma basis serving all five of the largest metropolitan statistical areas ("MSAs") in the southeastern United States and a meaningful presence in 10 of the 20 largest MSAs in the region. This combination is financially attractive to both parties and a great strategic and cultural fit.  Similar to our recent acquisition in Dallas and pending acquisitions in Tampa, Orlando, and Jacksonville, we believe the Atlanta market provides exceptional near-term and long-term growth opportunities."

Under the terms of the merger agreement, shareholders of Georgia Commerce will receive IBKC common stock.  Georgia Commerce common shares are expected to total approximately 4,727,618 shares at closing, assuming approximately 4,605,186 common shares outstanding and approximately 122,432 common shares associated with the potential exercise of warrants.

• Stock Consideration.  Each Georgia Commerce common share will be exchanged for 0.6134 share of IBKC common stock, subject to certain adjustments provided for in the merger agreement.  Based on IBKC's closing stock price on December 5, 2014, of $65.21 per share, the stock consideration would equate to $40.00 per Georgia Commerce common share, or approximately $189 million.
• Stock Option Consideration.  At September 30, 2014, Georgia Commerce had approximately 262,189 stock options outstanding with a weighted average exercise price of $18.10 per share. These stock options are anticipated to be in-the-money at closing.  The merger agreement provides that any Georgia Commerce stock options that remain outstanding immediately prior to closing, whether or not vested, will be cashed out at consummation of the merger.  Based on IBKC's closing stock price on December 5, 2014, of $65.21, the cash value for all stock options would total approximately $5.7 million.  The cash value of the stock options and stock consideration would equate to aggregate merger consideration of approximately $195 million.

IBKC currently estimates annual pre-tax expense reductions associated with the transaction will be approximately 20% of Georgia Commerce's run-rate expenses in 2014.  The expense savings are estimated to be fully achieved, on a run-rate basis, within six months of closing.  Acquisition- and conversion-related costs are estimated to be approximately $20.7 million on a pre-tax basis.  The transaction is expected to be 1.6% accretive to IBKC's fully diluted earnings per share ("EPS") in 2016 and approximately 5% accretive in 2017.

The transaction is expected to be neutral to IBKC's capital ratios, and to be approximately 1.8% dilutive to tangible book value per share on a pro forma basis at closing.  The tangible book value dilution is anticipated to be earned back in approximately 3.5 years.  The estimated internal rate of return for the transaction is expected to be greater than 20%, and, therefore, in excess of IBKC's cost of capital.

About Georgia Commerce Bancshares, Inc.

Georgia Commerce Bancshares, Inc. has nine offices in the Atlanta-Sandy Springs-Roswell, Georgia MSA.  At September 30, 2014, Georgia Commerce had:

Georgia Commerce had 142 employees at September 30, 2014.  For the quarter ended September 30, 2014, Georgia Commerce reported net income of $2.7 million, 1.09% ROA, 10.73% ROE, a 4.69% net interest margin, 0.52% cost of interest bearing deposits, and 0.40% total deposit cost.

About IBERIABANK Corporation

IBKC is a financial holding company with 280 combined offices, including 187 bank branch offices and three loan production offices in Louisiana, Arkansas, Tennessee, Alabama, Texas, and Florida, 22 title insurance offices in Arkansas and Louisiana, and mortgage representatives in 59 locations in 10 states.  IBERIABANK has eight locations with representatives of IBERIA Wealth Advisors in four states, and one IBERIA Capital Partners, L.L.C. office in New Orleans.

IBKC's common stock trades on the NASDAQ Global Select Market under the symbol "IBKC."  IBKC's market capitalization was approximately $2.2 billion, based on the NASDAQ Global Select Market closing stock price on December 5, 2014.

The following 11 investment firms currently provide equity research coverage on IBKC:

• Bank of America Merrill Lynch
• FIG Partners, LLC
• Jefferies & Co., Inc.
• Keefe, Bruyette & Woods, Inc.
• Raymond James & Associates, Inc.
• Robert W. Baird & Company
• Sandler O'Neill + Partners, L.P.
• Stephens, Inc.
• Sterne, Agee & Leach
• SunTrust Robinson-Humphrey
• Wunderlich Securities

Additional Information

Keefe, Bruyette & Woods, Inc., A Stifel Company, served as financial advisor and provided a fairness opinion to Georgia Commerce and the law firm of Womble Carlyle Sandridge & Rice, LLP served as legal advisor.  Banks Street Partners, LLC served as financial advisor to IBKC and Jones Walker LLP served as legal advisor.

IBKC has prepared a PowerPoint presentation that supplements information contained in this press release.  The PowerPoint presentation may be accessed on IBKC's web site, www.iberiabank.com, under "Investor Relations" and then "Presentations." IBKC will host a conference call associated with this announcement on December 8, 2014, beginning at 9:30 a.m. Central Time (10:30 a.m. Eastern Time) that may be accessed by dialing 1-800-230-1951. The confirmation code for the call is 346782.  A replay of the call will be available until midnight Central Time on December 15, 2014 by dialing 1-800-475-6701. The confirmation code for the replay is 346782. 

Caution About Forward-Looking Statements

This release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995.  In general, forward-looking statements usually use words such as "may," "believe," "expect," "anticipate," "intend," "will," "should," "plan," "estimate," "predict," "continue" and "potential" or the negative of these terms or other comparable terminology, including statements related to the expected timing of the closing of the proposed merger, the expected returns and other benefits of the proposed merger to shareholders, expected improvement in operating efficiency resulting from the proposed mergers with Georgia Commerce, Old Florida Bancshares, Inc. and Florida Bank Group, Inc., estimated expense reductions resulting from the transaction and the timing of achievement of such reductions, the impact on and timing of the recovery of the impact on tangible book value, and the effect of the mergers on IBKC's capital ratios.  Forward-looking statements represent management's beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance.  Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements, and there can be no assurances that: the proposed mergers will close when expected, the expected returns and other benefits of the proposed mergers to shareholders will be achieved, the expected operating efficiencies will result, estimated expense reductions resulting from the transactions will occur as and when expected, the impact on tangible book value will be recovered or as expected or that the effect on IBKC's capital ratios will be as expected.  Factors that could cause or contribute to such differences include, but are not limited to, the possibility that expected benefits may not materialize in the time frames expected or at all, or may be more costly to achieve; that the merger transactions may not be timely completed, if at all; that prior to completion of the merger transactions or thereafter, the parties' respective businesses may not perform as expected due to transaction-related uncertainties or other factors; that the parties are unable to implement successful integration strategies; that the required regulatory, shareholder, or other closing conditions are not satisfied in a timely manner, or at all; reputational risks and the reaction of the parties' customers to the merger transactions; diversion of management time to merger-related issues; and other factors and risk influences contained in the cautionary language included under the headings "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" in IBKC's Form 10-K for the fiscal year ended December 31, 2013, and Form 10-Qs for the quarters ended March 31, 2014, June 30, 2014, and September 30, 2014, and other documents subsequently filed by IBKC with the SEC.  Consequently, no forward-looking statement can be guaranteed. Neither IBKC nor Georgia Commerce undertakes any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For any forward-looking statements made in this press release or any related documents, IBKC and Georgia Commerce claim protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

This communication is being made in respect of the proposed merger transaction involving IBKC and Georgia Commerce. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. In connection with the proposed merger, IBKC will file with the SEC a registration statement on Form S-4 that will include a proxy statement/prospectus for the shareholders of Georgia Commerce. IBKC also plans to file other documents with the SEC regarding the proposed merger transaction with Georgia Commerce and the pending mergers with Florida Bank Group, Inc. and Old Florida Bancshares, Inc.  Georgia Commerce will mail the final proxy statement/prospectus to its shareholders. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION AND ANY OTHER RELEVANT DOCUMENTS CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. The proxy statement/prospectus, as well as other filings containing information about IBKC and Georgia Commerce, will be available without charge, at the SEC's Internet site (http://www.sec.gov). Copies of the proxy statement/prospectus and the filings with the SEC that will be incorporated by reference in the proxy statement/prospectus can also be obtained, when available, without charge, from  IBKC's website (http://www.iberiabank.com), under the heading "Investor Information," and on Georgia Commerce's website, at (www.gacommercebank.com).

IBKC and Georgia Commerce, and certain of their respective directors, executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from the shareholders of Georgia Commerce in respect of the proposed merger transaction. Information regarding the directors and executive officers of IBKC is set forth in the definitive proxy statement for IBKC's 2014 annual meeting of shareholders, as filed with the SEC on April 7, 2014, and in Forms 3, 4 and 5 filed with the SEC by its officers and directors.  Information regarding the directors and executive officers of Georgia Commerce who may be deemed participants in the solicitation of the shareholders of Georgia Commerce in connection with the proposed transaction will be included in the proxy statement/prospectus for Georgia Commerce's special meeting of shareholders, which will be filed by IBKC with the SEC.  Additional information regarding the interests of such participants will be included in the proxy statement/prospectus and other relevant documents regarding the proposed merger transaction filed with the SEC when they become available.

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SOURCE IBERIABANK Corporation

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