First Merchants acquires Noblesville-based bank

Muncie-based First Merchants Corp. has agreed to acquire Noblesville-based Community Bancshares Inc. for about $46 million in stock, the companies announced Tuesday.

The deal is expected to close in the first quarter of 2015 after shareholder and regulatory approvals.

Community Bancshares, parent of Community Bank, has 11 banking offices in the Indianapolis area, with eight in Hamilton County and three in Madison County. The company had $268.6 million in assets at the end of 2013.

First Merchants has nearly 100 banking offices around the state, primarily in central Indiana. Its subsidiaries include First Merchants Bank, Lafayette Bank & Trust, Commerce National Bank, First Merchants Trust Co., and First Merchants Insurance Group.

The combined company will have assets of about $5.7 billion and 107 banking offices in 26 Indiana counties, as well as two counties in both Ohio and Illinois.

Community Bankshares CEO Charles Crow, President Larry Riggs and Executive Vice President Russell Freed will join the First Merchants management team as part of the merger.

First Merchants was founded in 1982 and has banking-company predecessors in Muncie dating to 1893.

Community Bancshares was founded in 1991 after investors acquired Summitville Bank & Trust Co., which was formed in 1913.

“Like First Merchants, Community Bank has a deep-rooted commitment to community banking and we are excited for it to become the newest member of the First Merchants family,” First Merchants CEO Michael Rechin said in a prepared statement. “The addition of Community Bank supports our goal of becoming a more efficient, higher performing company.”

The deal will help First Merchants solidify its position as the second-largest Indiana-headquartered bank behind Evansville-based Old National Corp. Old National has assets of about $9.5 billion.

Last year, First Merchants acquired CFS Bancorp Inc. of Munster for about $140 million in stock, boosting its assets from about $4.2 billion to $5.4 billion.

First Merchants shares were up 1 cent late Tuesday, to $20.43 each.

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