Community Bank Agrees to Acquire Merchants Bancshares

Community Bank System Inc. agreed to acquire Merchants Bancshares Inc. in a deal the lenders value at roughly $304 million, which would combine two Northeast regional banks.

The deal will expand the reach of Community Bank, based near Syracuse, N.Y., into Merchants Bancshares' markets in Vermont and Western Massachusetts. Community Bank's operations currently are focused in upstate New York and northeastern Pennsylvania.

Merchants Bancshares holders will have the option to receive either 0.963 Community Bank shares, $40 a share in cash or the combination of 0.6741 Community Bank shares and $12 a share in cash for each Merchants Bancshares share held.

Community Bank has 200 locations and total assets of $8.7 billion, while Merchants Bancshares has 32 locations and total assets of nearly $1.9 billion.

Community Bank expects the deal, which is expected to close in the second quarter of 2017, to add 17 cents a share to its 2018 per-share earnings, excluding items.

Write to Tess Stynes at tess.stynes@wsj.com

(END) Dow Jones Newswires

October 24, 2016 09:45 ET (13:45 GMT)

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