Millersburg, Pa.-based Mid Penn Bancorp Inc. agreed to acquire Scottdale, Pa.-based Scottdale Bank & Trust Co. in a stock-and-cash transaction worth approximately $59.1 million.
Under the deal terms, Scottdale shareholders will receive consideration worth $1,166 per Scottdale common share. The deal consideration is subject to proration of no more than 10% in cash and no less than 90% in Mid Penn common stock.
SNL calculates the deal value to be 130.0% of book and tangible book, on a per-share basis. It is also 27.38% of deposits and 22.46% of assets, and its tangible book premium-to-core-deposits ratio is 6.41%. The deal carries a one-day and one-month premium of 153.48%, based on Scottdale's closing price of $460.00 on March 28 and March 1.
For comparison, offers for bank and thrift targets in the mid-Atlantic between March 29, 2016, and March 29, 2017, averaged 140.04% of book, 143.29% of tangible book and had a median of 21.73x last-12-month earnings, on an aggregate basis. On a per-share basis, they averaged 131.89% of book, 135.80% of tangible book and had a median of 21.27x LTM earnings.
Upon deal completion, Scottdale will merge into Mid Penn Bank and will operate as "Scottdale Bank & Trust, a division of Mid Penn Bank." Mid Penn will enter Westmoreland County with three branches, to be ranked No.11 with a 1.66% share of approximately $7.25 billion in total market deposits. It will also enter Fayette County with two branches, to be ranked sixth with a 4.59% share of approximately $2.02 billion in total market deposits. The combined entity is expected to have more than $1.3 billion in total assets.
The deal, subject to regulatory and shareholder approvals, is expected to close in the third quarter and be immediately accretive to tangible book value per share. In addition, the buyer has asked Donald Kiefer, chairman, president and CEO of Scottdale Bank, to join its board of directors following the deal's completion.
Sandler O'Neill & Partners LP acted as financial adviser and Stevens & Lee acted as legal adviser to Mid Penn. Ambassador Financial Group Inc. acted as financial adviser and Tucker Arensberg PC acted as legal adviser to Scottdale.
SNL data is an offering of S&P Global Market Intelligence.