Dive Brief:
- Gulfport, Mississippi-based Hancock Whitney Corp. has agreed to acquire Jackson, Mississippi-based Trustmark Corp. in an all-stock deal valued at $3.2 billion, the banks said Thursday.
- The combination would create a $58 billion-asset bank with about 370 branches across six Southeastern states, according to an investor presentation.
- The transaction is expected to close in the first quarter of 2027.
Dive Insight:
The combination of $39 billion-asset Hancock Whitney and $19 billion-asset Trustmark would create “the premier Gulf South bank” that’s “better positioned to compete with dominant nationwide and super-regional banks,” the lenders said in the investor presentation.
Hancock Whitney and Trustmark both have branches in Alabama, Florida, Mississippi and Texas. Hancock Whitney also has a sizable presence in Louisiana, while Trustmark’s footprint extends to Tennessee.
“By bringing together two high-performing banks with shared values, complementary capabilities, and a relentless focus on client success, we create an organization that is stronger as one,” John M. Hairston, Hancock Whitney’s president and CEO, said in the release. “This combination enhances our platform, expands growth opportunities, strengthens the core deposit franchise, and broadens the capabilities we deliver to consumer and business clients.”
The combined entity would have about $40 billion in gross loans and $48 billion in deposits.
Trustmark has 93 locations and the largest deposit market share across Mississippi, at about 13%, according to Federal Deposit Insurance Corp. data from June. Hancock Whitney, meanwhile, has the No. 2 deposit position in Louisiana, with about 12.4% market share and 97 locations.
Five members of Trustmark’s board, including President and CEO Duane Dewey, will join Hancock Whitney’s board once the deal closes, the banks said.
Both banks “have long held a shared commitment to exceptional client service and relationship banking,” Dewey said in the release.
“Given the strong cultural alignment and complementary business lines between our two organizations, we believe this transaction will generate substantial value and meaningful benefits for our customers, shareholders, associates, and communities,” he said.
Under the deal’s terms, Hancock Whitney will issue 0.7463 shares of common stock for each outstanding Trustmark share, at a consideration of about $54.02 per share, according to the investor presentation.
Hancock Whitney shareholders will own about 65% of the combined company once the deal is complete, compared with 35% for Trustmark shareholders.
The acquisition is estimated to be about 7% accretive to Hancock Whitney’s 2028 earnings per share, and “mildly dilutive” to regulatory capital at close, the bank said in the release.
The deal is priced at 1.78 times tangible book value. The transaction will be about 7% dilutive to tangible book value per share, with an earn-back period of about 2.8 years, inclusive of merger expenses, Hancock Whitney said.
“While the deal comes as a modest surprise, we view the transaction favorably and believe the potential synergies are being overlooked,” Citi analyst Benjamin Gerlinger wrote Thursday. “We believe the combination offers opportunities to deepen lower-cost deposit relationships, expand in concentrated [metro area] growth markets, and generate cost savings beyond management's assumptions given the meaningful branch overlap, particularly in Mississippi.”
