Downingtown, Pa.-based DNBFinancial Corp. ($748.8 million), the parent of DNB First NA, agreed to purchase Philadelphia-based ($310.7 million)in a stock-and-cash deal valued at $49.0 million.

East River shareholders will have the option to get either 0.6562of a DNB common share or $18.65 in cash for each outstanding East River common share,subject to proration such that the total cash consideration will be $6.7 million.The cash consideration total is subject to increase in the event that outstandingoptions are exercised before closing.

SNL calculates the dealvalue, on an aggregate basis, to be 161.2% of common equity and tangiblecommon equity and 22.1x earnings. It has a tangible book premium-to-core depositratio of 11.48%. It is also 20.96% of deposits and 15.77% of assets. For comparison,SNL's valuations for bank and thrift targets in the mid-Atlantic between April 4,2015, and April 4, 2016, averaged 123.84% of book, 132.27% of tangible book andhad a median of 24.64x last-12-month earnings, on an aggregate basis.

East River had $282.1 million in total loans and $233.8 millionin total deposits as of Dec. 31, 2015, with three full-service offices in Philadelphia.DNB will enter in Philadelphia County, Pa., with five branches, to be ranked No.16with a 0.42% share of approximately $50.98 billion in total market deposits. Thedeal should be immediately accretive to its EPS, excluding one-time costs. The tangiblebook value earnback period is expected to be 3.9 years. The transaction has an anticipatedinternal rate of return of 18%.

In a separate release, DNB said it appointed William Hieb permanentpresident and CEO and James Thornton permanent chairman. Hieb and Thornton had heldtheir positions in an interimcapacity since mid-January, following the death of Chairman and CEO William Latoff.

East River President and CEO Christopher McGill will join DNBas executive vice president and chief business development officer. Jerry Cotlov,executive vice president and chief lending officer of East River, will join DNBas senior vice president and assistant chief commercial lending officer.

East River Chairman John McGill Jr. will join DNB's board asvice chairman; two other members of the East River board, Charles Murray and DanielO'Donnell, will join the DNB board as independent directors.

The acquisition is slated to close during the second half, subjectto regulatory approval and the approval of shareholders of DNB and East River.

Ambassador Financial Group Inc. served as financial adviser toDNB, with Stradley Ronon Stevens & Young LLP acting as legal counsel. GriffinFinancial Group LLC served as financial adviser to East River Bank, and Silver FreedmanTaff & Tiernan LLP was legal counsel.

To use S&PGlobal Market Intelligence's branch analytics tools to compare market overlap, clickhere. To createcustom maps, click here.