Farmers State Bank of Munith has been acquired by Fentura Financial, Inc.

On June 22, 2021, the boards of directors of Fentura Financial, Inc. (OTCQX: FETM), the holding company for Fenton-based The State Bank, and Farmers State Bank based in Munith, today announced the execution of a definitive agreement by which Fentura Financial, Inc. (“Fentura”) will acquire Farmers State Bank (“FSB”) for $15.5 million in cash consideration. Based on current shares outstanding, shareholders of FSB will receive $103.33 in cash for each share. The transaction closed on December 1, 2021.

The boards of directors of both financial institutions have unanimously approved the purchase, which will include the acquisition of all FSB’s stock by Fentura. Excluding transaction costs, Fentura expects earnings per share (“EPS”) to be enhanced by 12-14% in each of the first two years following closing. The transaction is expected to dilute tangible book value by 6.1% at closing but anticipates earn back of the tangible book value dilution in less than four years using the crossover method.

As of March 31, 2021, FSB reported $104 million in assets, $45 million in loans and $95 million in deposits. The State Bank’s branch offices will increase to 20 locations, with the addition of FSB’s offices in Munith, Stockbridge and Grass Lake.

Upon completion of the transaction, Jeanne Richter, President & CFO of FSB, will join the senior management team of The State Bank and Craig Goodlock, Chairman & CEO of FSB, will retire.