DUNEDIN, Fla.–The $1.6-billion Achieva CU is merging in the $118-million Preferred Community Bank, based in Fort Myers, Fla.
The sale is expected to be finalized later this year following state and national regulator approvals, the credit union stated. If the deal is approved, it will be the fourth time a credit union has merged in a bank. In 2015, Achieva became the first credit union to merge with a bank, acquiring $165-million Calusa Bank based in Punta Gorda, Fla.
Under the terms of the merger agreement, the deal is a whole bank acquisition, the credit union stated. Preferred Community Bank showed positive net income ($463,000) through Sept. 30, 2017, according to FDIC data.
“This consolidation of complimentary services and products along with our entry into new markets makes this combination a strong strategic move for Achieva. Along with all of those positives, our corporate cultures are greatly aligned which is a key ingredient in any successful consolidation,” said Achieva CEO Gary Regoli. “Additionally, we already have a presence in the Lee County community with three branches, and we are excited about becoming an even stronger part of this vibrant community.”
The acquisition brings three new locations to Achieva.
“We are very proud of the dedicated team of bankers and valued clients that we have built at Preferred Community Bank and we are looking forward to our partnership with Achieva. This exciting combination will continue to support and expand our highly personalized service with even more products and services” said Brenda O’Neil, chairman and CEO of Preferred.
Michael Bell, attorney and counselor with Royal-Oak, Mich.-based Howard & Howard, who is representing Achieva, said the merger is another landmark deal for credit unions.
“The Florida Credit Union Act gives state-chartered CUs the right to do a purchase-and-assumption of a bank, as well as a merger,” said Bell, noting that the right to merge is not clear in the Federal CU Act and it’s a “mixed bag” with other states. “This may simply seem like a legal distinction—a merger and not a purchase and assumption—and it certainly is. But there are benefits to doing a merger. Merging in a bank can be an easier and simpler pathway.”
Dennis Holthaus, president of Achieva Merger Services, served as financial advisor to Achieva. Achieva developed Achieva Merger Services to provide merger consulting services to other credit unions and community banks, the CU explained.