Old Second Bancorp, Inc. and First Merchants Corporation Announce Transaction Involving Chicagoland Branch Operations
August 27 2024 - 8:41AM
Old Second Bancorp, Inc. (“Old Second Bancorp”) (NASDAQ: OSBC), the
parent company of Old Second National Bank (“Old Second”), and
First Merchants Corporation (“First Merchants Corp.”) (NASDAQ:
FRME), the parent company of First Merchants Bank (“First
Merchants”), jointly announced today that Old Second and First
Merchants have entered into a Purchase and Assumption Agreement
where Old Second will purchase 5 Illinois branch locations in the
Southeast Chicago MSA as well as certain branch related loans and
deposits from First Merchants.
The acquisition enhances Old Second’s position as one of the
largest banks headquartered in Chicago and adds meaningfully to its
existing branch network and in the Southeast Chicago market,
allowing for improved scale and penetration. The sale by First
Merchants completes its branch exit from suburban Chicago
markets.
Old Second anticipates assuming approximately $304 million in
deposits and purchasing approximately $12 million in branch-related
loans from this acquisition. Old Second will pay a deposit premium
of 7.5%, or approximately $23 million, in estimated cash
consideration to First Merchants. The branches to be acquired by
Old Second will operate as First Merchants branches until closing
and will be re-branded as Old Second branches immediately upon
closing of the transaction. Pending regulatory approval, the
closing is expected to occur near year-end 2024.
Keefe, Bruyette & Woods, Inc. served as financial advisor,
and Nelson Mullins Riley & Scarborough LLP served as legal
advisor to Old Second Bancorp. Stephens Inc. served as financial
advisor, and Dentons Bingham Greenebaum LLP served as legal advisor
to First Merchants Corp.
ABOUT OLD SECOND BANCORP
Old Second Bancorp, Inc., headquartered in Aurora, Illinois, is
the bank holding company for Old Second National Bank, which
celebrated 150 years of operation in 2021. Old Second's common
stock trades on The NASDAQ Stock Market under the symbol "OSBC".
More information about Old Second is available by visiting the
"Investor Relations" section of its website www.oldsecond.com.
Old Second National Bank, Member FDIC, provides full service
banking which includes customary consumer and commercial products
and services that banks provide including demand, NOW, money
market, savings, time deposit, individual retirement and Health
Savings Accounts; commercial, industrial, consumer and real estate
lending, including installment loans, agricultural loans, lines of
credit and overdraft checking; safe deposit operations; trust
services; wealth management services, and an extensive variety of
additional services tailored to the needs of individual customers.
The Bank also offers a full complement of electronic banking
services including web and mobile banking and corporate cash
management. As of June 30, 2024, Old Second has approximately $5.7
billion in assets, $4.5 billion in deposits and $4.0 billion in
loans.
ABOUT FIRST MERCHANTS CORPORATION
First Merchants Corporation is a financial holding company
headquartered in Muncie, Indiana. The Corporation has one
full-service bank charter, First Merchants Bank. The Bank also
operates as First Merchants Private Wealth Advisors (as a division
of First Merchants Bank).
First Merchants Corporation’s common stock is traded on the
NASDAQ Global Select Market System under the symbol “FRME.”
Quotations are carried in daily newspapers and can be found on the
company’s Internet web page (http://www.firstmerchants.com).
FORWARD-LOOKING STATEMENTS
This press release and statements by our management may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 regarding our expectations
with respect to the proposed transaction. Forward-looking
statements are based on our current beliefs, expectations and
assumptions and on information currently available and, can be
identified by the use of words such as “expects,” “intends,”
“believes,” “may,” “will,” “would,” “could,” “should,” “plan,”
“anticipate,” “estimate,” “possible,” “likely” or the negative
thereof as well as other similar words and expressions of the
future. These forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements anticipated in
such statements. Factors that could cause actual results to differ
materially from those described in the forward-looking statements
include, among others: (i) the possibility that any of the
anticipated benefits of the proposed transaction will not be
realized or will not be realized within the expected time period;
(ii) the risk that integration of the operations of the branch
locations with Old Second will be materially delayed or will be
more costly or difficult than expected; (iii) the effect of the
announcement of the transaction on employee relationships, customer
relationships and operating results; and (iv) the satisfaction of
closing conditions, including, but not limited to, the receipt of
requisite regulatory approvals. For a discussion of additional
factors that could cause actual results to differ materially from
those described in the forward-looking statements, please see the
risk factors discussed in Old Second Bancorp’s Form 10-K for the
year ended December 31, 2023, its Forms 10-Q for the quarters ended
March 31, 2024 and June 30, 2024, and other reports that are filed
with the U.S. Securities and Exchange Commission. Forward-looking
statements speak only as of the date they are made and, except as
required by law, Old Second Bancorp does not assume any duty to
update forward-looking statements.
OLD SECOND NATIONAL BANK CONTACT: |
FIRST MERCHANTS BANK CONTACT: |
Bradley S. Adams |
Nicole M. Weaver |
Executive Vice President, Chief Operating Officer and |
First Vice President and |
Chief Financial Officer |
Director of Corporate Administration |
(630) 906-5484 |
(765) 521-7619 |
BAdams@oldsecond.com |
nweaver@firstmerchants.com |
www.oldsecond.com |
www.firstmerchants.com |
Old Second Bancorp (NASDAQ:OSBC)
Historical Stock Chart
From Jul 2024 to Aug 2024
Old Second Bancorp (NASDAQ:OSBC)
Historical Stock Chart
From Aug 2023 to Aug 2024