On July 27, 2011, Eagle Bancorp, Inc. (“Eagle”) (Nasdaq: EGBN), the parent company of EagleBank (“EagleBank”), and Alliance Bankshares Corporation (“Alliance”) (Nasdaq: ABVA) announced that Eagle, Alliance and Alliance’s wholly owned subsidiary, Alliance Bank Corporation (“Alliance Bank”) have entered into a definitive merger agreement (the “Agreement”), pursuant to which Alliance will be merged into Eagle with Eagle being the surviving corporation and all of the outstanding shares of Alliance will be converted into shares of Eagle. Alliance has approximately $536 million in assets and $412 million in deposits. The merger will accelerate Eagle’s growth in Northern Virginia with the addition of Alliance’s 6 branches, which are all located in the attractive Northern Virginia market.
BuckleySandler partner, David Baris, and Counsel, Noel Gruber, represented Eagle Bancorp, Inc. on the investigation, negotiation and documentation of the transaction, including drafting of a definitive agreement to acquire Alliance Bankshares Corporation.
According to Baris, “This may or may not be the beginning of a wave of mergers and acquisitions in the community bank market which some have predicted for a while. However, the deal may be typical of future deals in that it involves a high performing, well capitalized bank, using acquisitions of less successful franchises which have attractive niches to expand geographically into attractive markets more rapidly than would be possible de novo.”
From the seller side, Baris further notes, “This may also be indicative of future deals; the thinly traded company looking for a much larger acquiror, relatively speaking. The money center and large regional banks generally have shown little interest in acquiring community banks in recent years. The sellers, assuming they receive stock as part of the consideration paid by the purchaser, will diversify future risk, gain stronger management, achieve greater trading liquidity, and hold stock in a company that could attract interest from larger potential acquirors some day.”
Eagle Bancorp, Inc. and Alliance Bankshares Corporation Merger Announcement: http://on-msn.com/ocM4bD