Under the deal, Beacon Bank will receive $46m in cash and $10m in trust preferred securities from Alerus.
Alerus president and CEO Randy Newman said: "This is the largest bank transaction we’ve ever entered into and will allow us not only to expand our Twin Cities footprint, but also to enter into a new market in Duluth."
The deal will increase Alerus’ Minnesota banking assets to around $771m and total banking assets to about $2bn.
The acquired business will expand the operations of Alerus in Twin Cities market and allow in entering the Duluth market.
Beacon Bank has three offices in Twin Cities, located in Shorewood, Excelsior and Eden Prairie, while two locations in Duluth of Minnesota.
"Alerus and Beacon Bank both share a customer advocate philosophy where long-term, personal partnerships are established between the customer and their trusted advisor."
Beacon Bank president and CEO Bob Weiss said: "Our customers will benefit from the expanded array of mortgage, retirement, and wealth management products and services enabling us to meet even their most complex financial needs, while continuing to work with the same local employees."
Subject to customary closing conditions, the deal is expected to be completed in the first quarter of 2016.
In 2003, Alerus first started operations in Minnesota through the acquisition of a retirement plan administration firm in St. Paul.
Currently, Alerus has around 665 employees, of which 300 employees work in the Twin Cities market at four banking locations in downtown Minneapolis, Minnetonka, Oakdale, and Maplewood.
Image: Alerus Financial to buy Twin Cities-based Beacon Bank. Photo: courtesy of adamr/ FreeDigitalPhotos.net.
