Serial acquirer Seacoast moves on Miami with $168.3M buy of Apollo Bank

Dive Brief:

Stuart, Florida-based Seacoast Banking Corp. said Tuesday it would buy Miami-based Apollo Bancshares in a $168.3 million, all-stock deal set to close in the fourth quarter, pending regulatory approval.
Apollo Bank had been an acquisition target in recent years. Tampa-based Suncoast Credit Union agreed in December 2019 to purchase Apollo as part of a strategy to expand into the Miami market. But the institutions terminated their proposed tie-up in May 2020, when the COVID-19 pandemic destabilized the value of the deal, Suncoast’s CEO said.
Seacoast, meanwhile, has built a reputation as a serial acquirer. The bank closed 10 acquisitions in the decade leading up to this year, according to American Banker, and began 2022 by closing its purchases of Sabal Palm Bank and Florida Business Bank.

Dive Insight:

Buying $1 billion-asset Apollo would add five Miami-Dade County branches to Seacoast’s 50-location Florida footprint. Seacoast would also take on Apollo’s $928 million in deposits and $665 million in loans. The bank said the Apollo deal would boost its deposits in the Miami-Fort Lauderdale-Pompano Beach metropolitan area by 45%, to roughly $2.7 billion.

"We see a great opportunity to grow our presence and expand our position in South Florida by complementing Apollo’s strengths with Seacoast’s innovation and breadth of offerings," Seacoast CEO Charles Shaffer said in a press release Tuesday, praising Apollo’s "outstanding reputation for service excellence and deep customer relationships in this important market."

Seacoast called the deal a "natural continuation" of its outlook on mergers and acquisitions — one that emphasizes "consolidation or entry into attractive growth markets, low concentration risks, and ease of execution that does not distract from its organic strategy."

Once the deal is completed, Apollo CEO Eddy Arriola will serve as Seacoast’s Miami-Dade market executive.

"Since 2010, Apollo Bank has been committed to propelling South Florida businesses with relationship-focused service and competitive products," Arriola said in Tuesday’s release. "We are delighted to join forces with Seacoast Bank, which shares our values and has been serving Florida consumers and businesses for nearly a century."

The Apollo deal marks Seacoast’s latest expansion in South Florida. It closed its acquisition of Boca Raton-based Legacy Bank in August 2021. Meanwhile, Seacoast’s purchase of Florida Business Bank, which closed in January, further entrenched it in Brevard County. Across the state, the Sabal Palm deal, announced at the same time, gave Seacoast an entry point to the Sarasota market.

Under Tuesday's deal, Apollo shareholders will receive 1.006529 Seacoast shares for each share of Apollo common stock. Minority interest holders, who own just over a 15% slice of Apollo, will receive 1.195651 Seacoast shares for each of their Apollo shares. That puts the transaction’s value at $168.3 million, based on Seacoast’s $35.48 closing price Monday.

Seacoast said it expects the transaction to be 8% accretive to earnings per share in 2023, with a "modest" dilution of its tangible book value that should be earned back in a little over two years.