Alerus Financial Corporation entered into an agreement to acquire HMN Financial, Inc. for approximately $120 million
May 14, 2024
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Alerus Financial Corporation (NasdaqCM:ALRS) entered into an agreement to acquire HMN Financial, Inc. (NasdaqGM:HMNF) for approximately $120 million on May 15, 2024. According to the terms of the agreement, stockholders of HMNF will receive 1.25 shares of Alerus common stock for each share of HMNF common stock they own. Under the terms of the agreement, HMNF will merge with and into Alerus. Upon completion of the Merger, one HMNF director will join the Alerus Board of Directors. The transaction has been unanimously approved by the Boards of Directors of both companies. Completion of the Merger is subject to customary closing conditions, including receipt of required regulatory approvals and approval by the stockholders of both Alerus and HMNF. The transaction is expected to close in the fourth quarter of 2024. The transaction is expected to be immediately accretive to Alerus? estimated earnings before one-time costs, with a tangible book value earn back of approximately 2.2 years (inclusive of interest rate marks), and an internal rate of return in excess of 25%.
Sanjay Patel of Raymond James & Associates, Inc. acted as financial advisor and Joseph T. Ceithaml, Megan E. Toal, Christine K. Nichols and Andrew K. Strimaitis of Barack Ferrazzano Kirschbaum & Nagelberg LLP acted as legal counsels to Alerus on the transaction. D.A. Davidson & Co. acted as financial advisor and Ballard Spahr LLP acted as legal counsel to HMNF.
Alerus Financial Corporation is a diversified financial services company. Through its subsidiary, Alerus Financial, National Association (the Bank), the Company provides financial solutions to businesses and consumers. The Company's segments include Banking, Retirement and Benefit Services, Wealth Management, and Mortgage. The Banking segment offers a complete line of loan, deposit, cash management, and treasury services. The Retirement and Benefit Services segment provides various services, including recordkeeping and administration services to qualified retirement plans; ESOP trustee, recordkeeping, and administration; and investment fiduciary services to retirement plans, among others. The Wealth Management segment provides advisory and planning services, investment management, and trust and fiduciary services. The Mortgage segment offers first and second mortgage loans through a centralized mortgage unit in Minneapolis, Minnesota, as well as through the banking office locations.