Union Planters to buy Magna for $2.2 billion

Union Planters is buying Magna for an estimated $2.2 billion in stock.

Memphis-based Union Planters Corp. and Brentwood, Mo.-based Magna Group announced the deal in the last week of February.

"This combination makes sense for our shareholders, our customers and the entire Magna family," said Thomas Andes, chairman and CEO of Magna Group, in a release.

"The Union Planters philosophy of community banking gives us the opportunity to continue a tradition of providing quality service to the markets we serve," he added. Andes will be vice chairman of Union Planters Corp. and will work integrating the two companies.

Union Planters Corp. is an $18 billion bank holding company with branches in eight states, including Union Planters of Southwest Missouri.

Magna Group is a $7 billion holding company, the third largest in Missouri, with about 140 banks in Missouri, Illinois and Iowa, the bulk of which are in and around the St. Louis area. About 60 percent of Magna's deposits are in the St. Louis market, with Illinois accounting for 21 percent and Iowa 19 percent of the bank's deposits.

The definitive agreement the two companies announced would swap 0.986 share of Union Planters stock for each Magna share. At the time of the announcement, Union Planters traded at $61.31, while Magna traded at $57.50. That reflects a more-than-$10 jump in Magna's stock.

The transaction will be accounted for as a tax-free pooling of interests. Both companies' boards have approved the agreement, and it is expected to close in the second or third quarter of 1998.

Union Planters has eight other acquisitions under way, worth about $3 billion, according to published reports. Jan. 1 it finalized the acquisition of Sho-Me Financial Corp., the holding company of 1st Savings Bank.

INSET CAPTION:

The agreement would swap 0.986 share of Union Planters stock for each Magna share.[[In-content Ad]]