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Southern Missouri Bancorp to buy Fortune Financial Corporation

Christian Fernsby |
Southern Missouri Bancorp, the parent corporation of Southern Bank, and Fortune Financial Corporation, the parent company of FortuneBank, announced the signing of a definitive merger agreement whereby Southern Missouri will acquire Fortune in a stock and cash transaction.

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Fortune operates two branches in Jefferson and St. Louis Counties, Missouri, both located within the St. Louis, Missouri, MSA. At June 30, 2021, Fortune’s consolidated assets were $253.7 million, including loans, net, of $209.3 million, while deposits totaled $214.5 million.

Southern Missouri reported total assets at June 30, 2021, of approximately $2.7 billion, including loans, net, of $2.2 billion, and total deposits of $2.3 billion.

On a pro forma basis, following the acquisition, the combined company's total assets will approximate $3.0 billion, with total loans, net, of $2.4 billion, and total deposits of $2.5 billion. The combined company will operate 51 locations in Missouri, Arkansas, and Illinois.

Under the terms of the merger agreement, unanimously approved by the boards of both entities, Fortune shareholders are projected to receive either a fixed exchange ratio of 0.2853 shares of Southern Missouri common stock or a cash payment of $12.55 for each Fortune share, at the election of the shareholders, subject to adjustment based on Fortune’s capital and the total outstanding shares of Fortune at closing.

Based on Southern Missouri’s $43.99 average closing price over the 20-day trading period ended September 24, 2021, the transaction’s indicated value is approximately $29.9 million, with merger consideration comprised of stock and cash at a 60:40 ratio. As part of the merger, Southern Missouri will also assume approximately $7.5 million in subordinated debt.

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