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Consumers Bancorp revised offer for Peoples Bancorp 2 times before agreement

Minerva, Ohio-based Consumers Bancorp Inc. revised its offer for in-state peer Peoples Bancorp of Mt. Pleasant Inc. twice before a deal was agreed upon.

Between August 2018 and November 2018, Consumers performed initial due diligence review of the financial condition and operations of Peoples and unit Peoples National Bank of Mount Pleasant.

Consumers first submitted an offer to acquire Peoples in November 2018. The bid provided for proposed merger consideration in the range of about $7.6 million to $8.3 million, in addition to a special cash dividend by Peoples to its shareholders of about $1.9 million, immediately before closing. This resulted in an aggregate merger consideration range of about $9.4 million to $10.2 million, or about $1,110.00 to $1,200.00 per Peoples common share. The consideration mix would be about 50% cash and 50% Consumers common shares.

From January to May, Consumers conducted additional due diligence on Peoples and Peoples National.

Consumers submitted a second indication of interest May 6 as a result of the additional due diligence. It offered an aggregate purchase price of about $9.9 million in the form of cash and Consumers common shares, equivalent to $1,163.86 per share, and that Consumers common shares would be roughly 50% of the consideration.

Peoples' board asked financial adviser Boenning & Scattergood Inc. to contact Consumers' financial adviser requesting an increase in the proposed purchase price.

Consumers submitted its third and final indication of interest May 11. It offered an aggregate purchase price of about $10.3 million, equivalent to $1,200.00 per share. Peoples' board considered the revised bid and decided to proceed with negotiating the merger agreement with Consumers.

The two companies announced the merger agreement June 14.

Peoples will pay Consumers a termination fee of $410,240 should the deal fall through under certain circumstances.