Home BancShares Makes Strategic Move With $150 Million Acquisition of Mountain Commerce Bancorp
Home BancShares, the holding company for Centennial Bank, recently announced that it will acquire Mountain Commerce Bancorp for $150 million in stock. This strategic move marks a significant milestone for Home BancShares as it will be their first presence in Tennessee, a market that CEO John Allison ranks as one of the most attractive in the country, alongside Texas and Florida.
A Platform for Future Expansion
The acquisition of Mountain Commerce Bancorp is not the largest transaction for Home BancShares. The company previously acquired Happy State Bank in Amarillo, Texas, in April 2022, a bank with $6.8 billion in assets. However, the significance of the Mountain Commerce Bancorp deal lies in its strategic importance. The deal offers Home BancShares an entry point into Nashville, Johnson City, and Knoxville, positioning it as a platform for expansion in Tennessee.
Home BancShares entered Florida in 2017 with the acquisition of Stonegate Bank, a bank with $3.1 billion in assets. With the addition of Mountain Commerce, Home BancShares will now have a presence in three of the most attractive markets, as identified by Allison. In a call with analysts, he stated, “I think Tennessee, Texas, and Florida are the three best states in the nation. Now we’re in the third one.”
Driving the Bus: Mountain Commerce’s Role
Bill Edwards, the founder and CEO of Mountain Commerce, will be in charge of overseeing the Tennessee market for the merged company and will guide its growth path. Allison praised Edwards’ leadership, stating, “Bill will run the operation. He’s going to be driving the bus.” Mountain Commerce reported a net income of $10.6 million in 2024 and $9.7 million in the first nine months of 2025. Despite being a profitable bank, Edwards cited funding and capital considerations as constraints on the company’s progress.
Looking to the Future: Organic Growth Opportunities and More Acquisitions
With access to Home BancShares’ $22.7 billion-asset balance sheet, these constraints will no longer hinder Mountain Commerce’s growth. Edwards expressed optimism about the potential for organic growth, stating, “There are tremendous organic-growth opportunities.” Both Allison and Edwards indicated that Home BancShares will continue pursuing additional deals in Tennessee and elsewhere, even as it works to integrate Mountain Commerce.
“We’ve got a war chest of capital, a fortress balance sheet,” Allison said. “We pride ourselves on that.” Allison also shared that Home BancShares has been interested in both Tennessee generally and Mountain Commerce specifically for several years. The deal was delayed due to a legal dispute that arose after a group of Happy State bankers quit to join a rival bank, resulting in a lawsuit. Home BancShares received a settlement payment earlier this year, clearing the way for the Mountain Commerce acquisition.
Analysts’ View on the Deal
The $150 million price tag for Mountain Commerce amounts to 105% of the bank’s tangible book value. The transaction is expected to close in the first half of 2026 and should be immediately accretive to earnings per share, book value per share, and tangible book value per share. Analysts and investors have shown support for the merger, with Home’s stock trending upward following the announcement.
Piper Sandler analyst Stephen Scouten expressed his belief that Home BancShares would continue to monitor and pursue potential deals, with Tennessee likely moving to the top of the list of future target markets. “Given the current regulatory environment, we would expect Home to continue to monitor and pursue potential deals,” Scouten said.
Allison affirmed his intention to pursue further deals, stating that he is open to whatever opportunities come. This includes potential acquisitions of banks that may be pressured to sell by HoldCo Asset Management, an activist investor based in Fort Lauderdale, Florida.
With this strategic move, Home BancShares is well-positioned for future growth and expansion in the attractive Tennessee market.
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