First Foundation to Acquire TGR Financial in $295MM Transaction

First Foundation and TGR Financial executed a definitive agreement under which TGR Financial will merge into First Foundation in an all-stock transaction valued at approximately $295 million, or $15.23 per TGR Financial share, based on the closing price of First Foundation’s common stock on May 28.

TGR Financial is the holding company of First Florida Integrity Bank, a Florida state-chartered bank with $2.3 billion in total assets, as of March 31, and seven branch offices located in southwest Florida. Immediately following the merger of TGR Financial with and into First Foundation, First Florida Integrity Bank will merge with and into First Foundation Bank, which is one of First Foundation’s wholly-owned operating subsidiaries. The transaction will increase First Foundation’s total bank assets to approximate $9.4 billion on a pro forma basis as of March 31.

“This strategic acquisition provides First Foundation an excellent opportunity to expand into a highly desirable market,” Scott F. Kavanaugh, CEO of First Foundation, said. “First Florida Integrity Bank has built a valuable banking franchise and we are committed to continuing its legacy by serving the needs of all its clients and enhancing its offering with our broad platform of services, as well as supporting programs available to local nonprofits in the bank’s local communities. This acquisition highlights our desire to continue growing our business in markets with attractive demographic and economic trends, and we are excited to have a regional presence spanning from coast to coast.”

“We are pleased that we have aligned with an organization that will expand resources to our clients, offering First Foundation’s integrated banking and wealth management services through our local team,” Gary L. Tice, chairman and CEO of TGR Financial, said. “Because of its financial strength, profitable history, and with much of its growth still before it, First Foundation makes for an ideal partner for our clients, employees and shareholders.”

Under the terms of the definitive agreement, upon consummation of the transaction, each TGR Financial shareholder will receive 0.6068 of a share of First Foundation common stock for each share of TGR Financial common stock or TGR Financial Series A non-voting convertible preferred stock they own. In total, TGR Financial shareholders will own approximately 20.2% of the outstanding shares of First Foundation’s common stock immediately following the consummation of the transaction.

The board of directors of each company unanimously approved the merger agreement. The transaction is expected to close in the second half of 2021 and is subject to the satisfaction of customary closing conditions, including the receipt of regulatory approvals and approvals from First Foundation stockholders and TGR Financial shareholders. Upon closing of the transaction, Tice will join the First Foundation board of directors. TGR Financial’s directors and executive officers and certain shareholders have entered into agreements with First Foundation pursuant to which they committed to vote their shares, which represent approximately 46.1% of TGR Financial’s issued and outstanding common stock, in favor of the acquisition.

This will become First Foundation’s sixth acquisition. It previously acquired Premier Business Bank, Community 1st Bank, two branches from Pacific Western Bank, Pacific Rim Bank and Desert Commercial Bank.

D.A. Davidson & Co. served as financial advisor and Sheppard Mullin Richter & Hampton served as legal counsel to First Foundation. Truist Financial and Swan Hill Advisors served as financial advisors and Smith Mackinnon and Smith Gambrell & Russell served as legal counsel to TGR Financial.

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