SouthState Corporation announces $2bn acquisition of Independent Bank Group

SouthState Corporation (NYSE: SSB) has entered into a definitive agreement to acquire Independent Bank Group, Inc. (NASDAQ: IBTX), based in McKinney, Texas, in an all-stock transaction valued at approximately $2 billion. This strategic move will significantly expand SouthState’s market presence, combining with Independent Bank Group’s substantial operations in key Texan markets and the Colorado Front Range.

Transaction Details

The terms of the agreement will allow Independent Bank Group shareholders to receive 0.60 shares of SouthState common stock for each share they hold, translating to a value of $48.51 per share based on SouthState’s closing stock price as of May 17, 2024. With this acquisition, the pro forma total assets of the combined entity are expected to reach $65 billion, with $55 billion in deposits and $48 billion in gross loans. The resulting market capitalization is estimated at approximately $8.2 billion.

Strategic Enhancements and Market Impact

John C. Corbett, CEO of SouthState, praised the acquisition, noting the strategic fit between the two companies. “With a local, geographic management model, an industry-leading track record on credit, and a presence in some of the best markets in the country, Independent Bank Group is a great fit with SouthState,” said Corbett. Independent Bank Group operates in 12 of the 15 fastest-growing Metropolitan Statistical Areas in the United States, enhancing SouthState’s reach and operational capacity.

David R. Brooks, Chairman and CEO of Independent Bank Group, also expressed optimism about the merger. “The combination of these two companies operating in growing markets provides a great opportunity for our teammates, clients, and communities to flourish,” stated Brooks.

Board Integration and Future Governance

Post-acquisition, three directors from Independent Bank Group, including David Brooks, will join the boards of SouthState Corporation and SouthState Bank, ensuring continuity and strategic alignment. This transition is supported by unanimous board approvals and voting agreements from significant shareholders of both companies.

Closing Conditions and Advisors

The transaction, expected to close by the end of the first quarter of 2025, is subject to customary closing conditions, including regulatory approvals and shareholder approval from both companies. Raymond James & Associates, Inc. and Davis Polk & Wardwell LLP are advising SouthState, while Keefe, Bruyette & Woods and Wachtell, Lipton, Rosen & Katz represent Independent Bank Group.

The acquisition of Independent Bank Group by SouthState Corporation not only enhances SouthState’s footprint in crucial markets but also aligns with its strategic goals to diversify and strengthen its service offerings across the United States. This merger is likely to set a significant precedent in the banking sector, particularly in terms of integration strategies and market expansion.