Dive Brief:
- Lubbock, Texas-based South Plains Financial will acquire Houston-based BOH Holdings in an all-stock transaction valued at $105.9 million, the companies said Monday.
- Acquiring BOH, the holding company for Bank of Houston, will give $4.4 billion-asset South Plains an additional $772 million in assets, $633 million in loans and $629 million in deposits, according to a news release.
- The proposed transaction is projected to close in the second quarter of 2026 and awaits approval from regulators and BOH shareholders.
Dive Insight:
South Plains, the holding company for City Bank, said the deal would bolster its position as a Texas community bank – growing its branch count to 26 – and particularly enhance its presence in Houston.
South Plains also has operations in the Dallas, El Paso, Permian Basin and College Station markets in Texas, and the Ruidoso, New Mexico, market. Bank of Houston, meanwhile, operates one branch in Houston and one in Dublin, roughly two hours southwest of Fort Worth.
The combined company would have about $5.4 billion in assets, $3.8 billion in loans and $4.6 billion in deposits, according to Monday’s release.
South Plains CEO Curtis Griffith said the bank has been exploring an acquisition to expand the bank’s reach, while pursuing organic growth.
“Our proposed acquisition of BOH is an important step in achieving our goal given the impressive franchise they have built in the fast-growing Houston market, which will add scale to our existing operations while also bringing long standing customer relationships to City Bank,” Griffith said in the release.
He also hinted at the possibility of additional M&A.
“I have often spoken to our ability to execute acquisitions given the investments that we have made across the Company’s infrastructure and technology platforms that positions South Plains to efficiently scale our operations as we continue to expand across our markets,” Griffith said.
BOH CEO Jim Stein said the deal “provides needed resources to help accelerate our combined growth which we believe will drive value for our shareholders that we could not have achieved on our own.”
“The strength of South Plains’ low cost, community deposits as well as their more expansive product portfolio is very attractive to us and should enable us to deepen our existing client relationships while also pursuing new relationships,” Stein said in the release. “I am also excited for our employees given the unique focus that City Bank places on their employees, the benefits they provide, and the great work environment that they have cultivated.”
With the acquisition, Stein will join South Plains and continue leading his team in Houston, according to the release. He will also be appointed to the boards of South Plains and City Bank.
Under the proposed deal’s terms, South Plains would exchange 0.1925 of its shares for each outstanding share of BOH. The transaction’s value is based on the $37.79 closing price of South Plains’ stock from Friday.
South Plains plans to issue about 2.8 million shares of its common stock, enabling former BOH shareholders to own about 14.5% of the combined company once the deal is completed.
The transaction is expected to be 11% accretive to South Plains’ earnings per share in 2027, and have a tangible book value per share earnback period of less than three years, according to the release.
The combined company will rank 11th in deposits in Houston by a Texas-headquartered bank, South Plains said.
Texas arguably has been the most targeted state for bank mergers and acquisitions this year, with Midwestern regionals Fifth Third and Huntington acquiring Texas-based banks, along with in-state activity from the likes of Houston-based Prosperity and Third Coast.
In Houston, money center banks claim about 83% of the deposit market share, while banks headquartered in Texas have about 9% and those based outside of Texas have about 8%, as of June 30, South Plains noted in an investor presentation.
