Penns Woods Bancorp, Inc. to Acquire Luzerne Bank
May 29 2013 - 4:03PM
Penns Woods Bancorp, Inc. (Penns Woods) (Nasdaq:PWOD), announced
today that its shareholders approved the Company's pending
acquisition of Luzerne Bank at the Annual Meeting of Shareholders
held on May 29, 2013.
The shareholders of Luzerne National Corporation also approved
the acquisition at their Annual Meeting of Shareholders held on May
29, 2013.
The acquisition is expected to become effective on June 1, 2013,
subject to the satisfaction of other customary closing conditions.
Penns Woods intends to continue to operate Luzerne Bank as a
separate banking subsidiary of Penns Woods under the name "Luzerne
Bank." The existing members of the board of directors of Luzerne
Bank will continue to serve as directors after closing, and Richard
A. Grafmyre, Penns Woods' President and Chief Executive Officer,
will join the Luzerne Bank board. In addition, at closing the Penns
Woods board of directors will be expanded to include three current
non-employee directors from the Luzerne board of directors.
"The acquisition is a great opportunity for us to provide our
customers with geographically expanded access to tailored banking
products and services. This acquisition presents an almost seamless
opportunity because of the two banks' similar operating styles,"
said Richard A. Grafmyre, President and CEO of Penns Woods and
Jersey Shore State Bank. "For most of our customers, there will be
little to no change in the way they do business with Jersey Shore
State Bank and Luzerne Bank, yet both organizations' capacity to do
business with customers will be greatly enhanced."
"The acquisition of Luzerne Bank will deliver significant value
for the shareholders," said Ronald A. Walko, Chairman of the Board
of Penns Woods. "I look forward to the opportunities presented by
the partnership of the two organizations."
"The board of directors, management and staff of Luzerne Bank
are excited about this affiliation," said Robert C. Snyder,
President of Luzerne Bank. "Not only is the transaction a win for
our shareholders, it keeps the 106 year heritage of Luzerne Bank
alive and well."
"The decision to merge was based upon a number of factors
including the increasing operating costs resulting from regulatory
and compliance mandates. But in the end, the decision came down to
finding the right partner, and we found what we believe to be the
perfect teammate in Penns Woods," stated Joseph E. Kluger, Chairman
of the Board of Luzerne. "We are very excited about the merger with
Penns Woods, as well as the future of Luzerne Bank."
Under the terms of the agreement, Penns Woods will acquire all
of the outstanding shares of Luzerne for a total purchase price of
approximately $44.5 million as of the date of the agreement.
Luzerne shareholders will have the opportunity to elect to receive
for each outstanding share of Luzerne common stock either 1.5534
shares of Penns Woods common stock, $61.86 in cash or a combination
of cash or stock. All shareholder elections will be subject to
allocation and proration procedures set forth in the agreement that
are designed to ensure that no more than 10% of the outstanding
Luzerne shares are exchanged for cash. The transaction is expected
to be a tax-free exchange to the extent that shareholders of
Luzerne receive stock in exchange for their shares.
About the Company:
Penns Woods Bancorp, Inc. is the parent company of Jersey Shore
State Bank, which operates thirteen branch offices providing
financial services in Lycoming, Clinton, Centre, and Montour
Counties. Luzerne Bank operates eight branch offices providing
financial services in Luzerne and Lackawanna counties. Investment
and insurance products are offered through Jersey Shore State
Bank's subsidiary, The M Group, Inc. D/B/A The Comprehensive
Financial Group.
Forward-Looking Statements:
Certain statements contained herein may be considered
"forward-looking statements" as defined in the Private Securities
Litigation Reform Act of 1995. These statements are based upon the
belief of the management of Penns Woods Bancorp, Inc. (PWOD) and
Luzerne Bank (Luzerne), and may be, but not necessarily are,
identified by such words as "expect," "plan," "anticipate,"
"target," "forecast," and "goal." Because such "forward-looking
statements" are subject to risks and uncertainties, actual results
may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause actual results
to differ materially from PWOD and Luzerne's expectations include,
but are not limited to, changes in monetary and fiscal policies of
the Federal Reserve Board and the U.S. Government, particularly
related to changes in interest rates, changes in general economic
conditions, legislative or regulatory changes, downturn in the
demand for loan, deposit and other financial services in Jersey
Shore State Bank and Luzerne's respective market areas, increased
competition from other banks and non-bank providers of financial
services, technological changes and increased technology-related
costs, changes in accounting principles, or the application of
generally accepted accounting principles and other similar outside
influences. For a list of other factors which could affect
operating results, see PWOD's filings with the Securities and
Exchange Commission, including "Item 1A. Risk Factors," set forth
in PWOD's Annual Report on Form 10-K for the fiscal year ended
December 31, 2012.
You should not place undue reliance on any forward-looking
statements. These statements speak only as of the date of this
press release, even if subsequently made available by PWOD on its
website or otherwise. PWOD undertakes no obligation to update or
revise these statements to reflect events or circumstances
occurring after the date of this press release.
CONTACT: Richard A. Grafmyre
President & CEO
Penns Woods Bancorp, Inc.
(570) 322-1111
Michelle M. Karas
Vice President/Head of Institutional Advancement
Jersey Shore State Bank
(570) 567-2075
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