South State Bank Merger with Park Sterling, Expands Presence in SC, Georgia, Virginia

Friday, April 28th, 2017

South State Corporation  and Park Sterling Corporation jointly announced the signing of a definitive merger agreement. Combining the two companies will create a $14.5 billion in assets franchise operating throughout the Carolinas, Virginia and Georgia.

Headquartered in Charlotte, North Carolina, Park Sterling Corporation is the holding company for Park Sterling Bank, which has over 50 branches across NC, SC, VA and GA. This opportunity will allow for a deeper and denser market presence across the Southeast, a more robust commercial business strategy, a greater presence in Charlotte and entry into the Richmond market.

“Our partnership with Park Sterling is a natural next step. We both have a common vision for building a quality regional bank in the Southeast, and this is a significant step forward in accomplishing that goal,” said Robert R. Hill, Jr., CEO South State Corporation. “We are fortunate to have two great teams that operate in dynamic markets and we are excited about the opportunities this merger creates.”

As of March 31, 2017, Park Sterling Corporation had approximately $3.3 billion in assets, $2.5 billion in deposits and $2.5 billion in loans. Upon completion of the transaction, the combined company will have approximately $14.5 billion in assets, $11.5 billion in deposits and $10.4 billion in loans.

“Our team is proud to be partnering with South State to create what we believe will come to be recognized as the preeminent regional community banking franchise in the Southeast,” said James C. Cherry, CEO of Park Sterling Corporation. “This combination will substantially fulfill our vision of truly becoming big enough to have the talent and services necessary to help customers achieve their financial aspirations while still remaining small enough and passionate enough to care that they do.”

The merger agreement has been unanimously approved by the board of directors of each company. Pending regulatory and shareholder approvals and other customary closing conditions, the closing is anticipated to occur in the fourth quarter of 2017 and the system conversion is scheduled to occur in the first quarter of 2018. At closing, Park Sterling Corporation will be merged into South State Corporation, and Park Sterling’s bank subsidiary, Park Sterling Bank, will be merged into South State’s bank subsidiary, South State Bank.

Upon consummation of the merger, Cherry will be appointed to the combined company’s board of directors in addition to another individual to be mutually agreed upon and named at a later date.

Under the terms of the agreement, shareholders of Park Sterling Corporation will receive 0.14 shares of South State common stock for each share of Park Sterling common stock. The aggregate consideration is valued at approximately $690.8 million in the aggregate, based on 53,112,726 shares of Park Sterling common stock outstanding as of March 31, 2017 and on South State’s April 26, 2017 closing stock price of $91.90.

Keefe, Bruyette, & Woods, Inc., served as financial advisor, and Wachtell, Lipton, Rosen & Katz served as legal counsel to South State Corporation. Stephens Inc. served as financial advisor, and McGuireWoods LLP served as legal counsel to Park Sterling Corporation.