The transaction was valued at approximately $105.9 million, or $7.27 per BOH common share, based on South Plains' closing stock price of $37.79 on November 28, 2025. Under the merger agreement, each BOH share was exchanged for 0.1925 shares of South Plains common stock, subject to certain adjustments, and South Plains issued approximately 2.8 million shares (based on 14,334,219 BOH shares outstanding). Holders of BOH stock appreciation rights and unexercised warrants received cash consideration instead of stock. On a pro forma basis at signing, former BOH shareholders were expected to own approximately 14.5% of the combined company, with South Plains shareholders owning the remaining 85.5%. The deal was structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code; if the stock consideration's value fell below 40% of total merger consideration before closing, the agreement provided for the exchange ratio to be adjusted upward (with a corresponding reduction in any cash consideration) to preserve that threshold.
South Plains disclosed several valuation multiples for the deal in its investor presentation: the transaction value represented approximately 143% of BOH's tangible common equity, 6.8 times BOH's estimated 2027 earnings per share, and a franchise premium of 7.4% of BOH's core deposits. As of September 30, 2025, BOH had approximately $772 million in total assets, $633 million in gross loans, and $629 million in deposits; at December 31, 2025 (per the closing press release) BOH had $744 million in total assets, $624 million in total loans, and $603 million in total deposits. The pro forma combined company was expected to have approximately $5.4 billion in total assets, $3.8 billion in gross loans, and $4.6 billion in total deposits, and a pro forma market capitalization of approximately $718 million at the time of signing.
South Plains disclosed expected pre-tax cost savings of approximately $4.6 million in 2027, equal to about 25% of BOH's non-interest expense base, with 75% of the savings expected to be realized in 2026 and 100% thereafter. The company also disclosed a loan mark of $9.2 million (comprising a $7.6 million gross credit mark, equal to 1.20% of BOH's loans as of September 30, 2025, and a $1.6 million interest rate mark to be amortized over 5.0 years), a core deposit intangible of 1.50% of non-time deposits to be amortized over 10 years using the sum-of-years-digits method, and pre-tax transaction expenses of $13.8 million. The transaction was expected to be approximately 11% accretive to South Plains' earnings per share in 2027, with an estimated tangible book value per share earnback period of less than 3.0 years.
Curtis Griffith, Chairman and CEO of South Plains, said the acquisition was "an important step in achieving our goal given the impressive franchise they have built in the fast-growing Houston market, which will add scale to our existing operations while also bringing long standing customer relationships to City Bank," adding that he believed "this combination will deliver substantial value to both South Plains' and BOH's shareholders which will make this a true win-win transaction." Jim Stein, Chairman, President and CEO of BOH, said "Houston is a dynamic community banking market, and this partnership provides needed resources to help accelerate our combined growth which we believe will drive value for our shareholders that we could not have achieved on our own," citing South Plains' "low cost, community deposits as well as their more expansive product portfolio." Cory Newsom, President of South Plains, said the company performed "a thorough, deep dive into BOH's loan portfolio and underwriting processes and found a credit culture that resembled ours," which he said "provides real confidence in the potential synergy and success of this acquisition."
Upon completion, BOH's Chairman, President and CEO Jim Stein joined the boards of directors of both South Plains and City Bank and continued leading the Houston team; City Bank also entered into a new employment agreement with James D. Stein (base salary of not less than $350,000, a target annual bonus of 23.33% of base salary and a maximum of 35%) to help transition and assimilate Bank of Houston post-merger. Retention agreements were also put in place for other key BOH employees.
On the target side, Hillworth Bank Partners served as financial advisor to BOH and rendered a fairness opinion to BOH's board of directors. Fenimore Kay Harrison LLP served as BOH's legal advisor. On the acquirer side, Raymond James & Associates, Inc. served as financial advisor to South Plains and rendered a fairness opinion to its board of directors, and Hunton Andrews Kurth LLP served as South Plains' legal advisor.
The merger agreement, filed as Exhibit 2.1 to the December 1, 2025 Form 8-K, provided for a termination fee of $4,235,314 payable by BOH to South Plains in specified circumstances, including if BOH's board terminated the agreement to accept a superior proposal, if South Plains terminated after a change in BOH's board recommendation or a breach of BOH's no-shop covenant, or in certain scenarios tied to failure to hold the BOH shareholder vote after the Form S-4 registration statement had been effective for at least 25 business days. The agreement's outside date was November 1, 2026, extendable unilaterally by South Plains for up to an additional 60 days if the only unmet condition was pending regulatory approval. In the signing press release, South Plains stated it would file a Form S-4 registration statement with the SEC that would include a proxy statement for a special meeting of BOH shareholders and would also serve as a prospectus for the SPFI shares to be issued. The companies also noted the transaction required the approval of BOH's shareholders and "customary closing conditions, including the receipt of all required regulatory approvals."
On March 23, 2026, South Plains and BOH jointly announced that BOH's shareholders had approved the merger at a shareholder meeting held March 20, 2026, and that the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Texas Department of Banking had granted the required regulatory approvals and non-objections. With all approvals obtained, the companies said the merger was expected to close on April 1, 2026, subject to satisfaction of remaining customary closing conditions. The merger closed as planned on April 1, 2026, with BOH merging into South Plains and Bank of Houston merging into City Bank, both with South Plains and City Bank as the surviving entities, respectively.