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Acquisition Deal Drives Community First Bank’s Shares to 52-Week High

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Community First Bank’s parent company witnessed a surge in its shares, reaching a 52-week high, following the announcement of its acquisition by Dogwood State Bank. The deal values each share of Community First Bank at an implied price of $11.75.

During early trading, the stock soared to $8.93 per share before settling at $8.05, resulting in a 21% gain for the day. This surge marks the highest trading level since July 2022.

Under the terms of the agreement, Dogwood will exchange 58% of a Dogwood share for each share of Community First’s stock. Additionally, it will offer nearly 64.8 Dogwood shares in exchange for each share of Community First’s preferred stock. The overall transaction value of $11.75 per share is based on Dogwood’s recent capital raise at $20 per share.

Notably, the transaction structure aims to qualify as a tax-free reorganization for federal income tax purposes. As a result, Community First shareholders can anticipate a tax-free exchange. The completion of the acquisition is anticipated in the second half of 2024.

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