United Community Bank merging with S.C.’s Palmetto Bank

Blairsville-based United Community Banks, which earlier this year acquired a Tennessee bank, announced Wednesday that it has a $240.5 million merger deal with Palmetto Bancshares in South Carolina.

United, the parent of United Community Bank, said its merger with the parent of The Palmetto Bank is part of its strategy to grow operations in the Southeast.

Also on Wednesday, United said first-quarter earnings rose 15 percent from a year ago, to $17.7 million. The bank said strong growth in loans and fee revenue helped.

Palmetto Bank, which will become United Community Bank after the deal is completed, is a 108-year-old institution with $1.2 billion in assets. The upstate South Carolina bank has 25 branches.

“Joining forces with Palmetto will greatly enhance our presence in these markets, creating value for shareholders and customers of both organizations,” United Chairman and Chief Executive Officer Jimmy Tallent said in a release.

In Nasdaq trading Wednesday, shares of United (ticker UCBI) fell slightly to $18.47. As part of the deal, Palmetto shareholders can receive $19.25 in cash or 0.97 shares of United common stock, or any combination thereof, for each share of Palmetto common stock.

In January, United announced it was acquiring the Tennessee bank holding company MoneyTree and its First National Bank subsidiary in a stock and cash deal valued at $52 million.