Civista Bancshares to acquire Farmers Savings Bank in $70.4 million deal

SANDUSKY, Ohio - Civista Bancshares, Inc. (NASDAQ:CIVB), a regional bank whose stock has delivered a remarkable 71% return over the past year according to InvestingPro data, announced Thursday it has signed a definitive merger agreement to acquire The Farmers Savings Bank in a cash and stock transaction valued at approximately $70.4 million.

The acquisition will add two branches in Medina and Lorain Counties in Northeast Ohio to Civista’s network, along with approximately $183 million in deposits. As of March 31, 2025, Farmers reported total assets of $285 million and net loans of $104 million. Civista, currently trading near its 52-week high of $25.59, maintains a strong financial health score of 2.59 on InvestingPro’s comprehensive assessment system.

Under the terms of the agreement, Civista will pay $34.925 million in cash and issue 1,434,491 common shares for all outstanding Farmers shares. The transaction is expected to close in the fourth quarter of 2025, subject to regulatory approvals and other customary closing conditions.

Civista also announced the launch of an underwritten public offering of its common shares, with Piper Sandler & Co. serving as the sole book-running manager. The company plans to use the net proceeds for general corporate purposes, including potential organic growth opportunities and future strategic transactions.

Once the acquisition is completed, the combined entity will have approximately $4.4 billion in total assets, $3.2 billion in net loans, and $3.5 billion in deposits, based on financial data from March 31, 2025. The bank’s strong fundamentals are reflected in its moderate P/E ratio of 10.84 and consistent dividend growth, having raised dividends for 14 consecutive years according to InvestingPro’s analysis.

"We are excited to welcome Farmers Savings Bank into the Civista family," said Dennis G. Shaffer, President and CEO of Civista, in a statement included in the press release.

The acquisition is expected to be approximately 10% accretive to Civista’s diluted earnings per share once anticipated cost savings are fully implemented. Any tangible book value dilution is expected to be recovered in approximately three years after closing. With six analysts recently revising their earnings estimates upward and a consensus price target suggesting further upside potential, the stock appears positioned for continued growth.

Piper Sandler & Co. is acting as financial advisor to Civista, while Janney Montgomery Scott LLC is advising Farmers on the transaction.

In other recent news, Civista Bancshares reported a strong financial performance for the first quarter of 2025, with earnings per share (EPS) of $0.66, surpassing analyst expectations by 29.4%. The company’s revenue also exceeded forecasts, reaching $40.63 million against the anticipated $40.33 million. This solid performance was driven by a 4.5% quarter-over-quarter increase in net interest income, which amounted to $32.8 million. Additionally, Civista’s net interest margin expanded by 15 basis points to 3.51%. Analysts from Stephens responded to this performance by raising the price target for Civista Bancshares to $25 from $24, while maintaining an Equal Weight rating on the stock. Despite the strong earnings, the company’s tangible common equity ratio remains a concern at 6.6%, with expectations to improve to 7.0%-7.5% by the end of 2025. Civista Bancshares is also advancing its digital initiatives and operational efficiencies, with plans to launch a digital online account opening software in July. The company continues to focus on maintaining a disciplined approach to loan and deposit pricing.

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