Farmers National Banc Corp. ( FMNB Quick Quote FMNB - Free Report) has entered a merger agreement with Cortland Bancorp Inc., per which Cortland’s branches will become branches of Farmers National, and The Cortland Savings and Banking Company will be merged with Farmers National Bank.
Markedly, the company has been committed to boosting inorganic growth of its businesses and has executed six acquisitions in the past six years. It focuses on franchises with a strong customer base, which offer cross-sell opportunities and compelling geographic diversification opportunities.
Cortland Bancorp’s shareholders may choose to receive either $28 per share in cash or 1.75 shares of Farmers’ common stock. This is conditional on an overall limitation of 75% of the shares being exchanged for Farmers National shares and 25% for cash.
The transaction is valued at around $124 million, based on Farmers’ closing share price of $16.87 on Jun 22. The acquisition, pending customary regulatory approvals and Cortland’s shareholder consent, is expected to close in fourth-quarter 2021.
By adding Cortland Bancorp assets to its own, the merger will significantly boost Farmers National’s loans and deposits. Particularly, as of Mar 31, 2021, Cortland Bancorp had total assets of $791.7 million, including gross loans of $518.6 million, deposits of $680.3 million and equity of $81.1 million.
Upon the merger completion, Farmers National expects to have $2.6 billion in loans, $3.3 billion in deposits and $4.1 billion in assets, indicating increases of 26%, 26% and 25%, respectively.
Moreover, management believes that the merger will enhance its market share in Trumbull and Mahoning Counties, and expand presence in the attractive Cleveland suburban area. Specifically, it will have a presence in 48 locations throughout Ohio and western Pennsylvania.
Lastly, the company projects 12.4% accretion to its earnings per share in 2022 (assuming 75% cost savings phased in) and 13.5% accretion on a fully phased-in basis.
Currently Farmers National carries a Zacks Rank #3 (Hold). The stock has gained 21.4% over the past six months, outperforming the
industry’s rally of 17.8%.
Image Source: Zacks Investment Research Stock to Consider Park National Corporation ( PRK Quick Quote PRK - Free Report) sports a Zacks Rank of 1 (Strong Buy) at present. The Zacks Consensus Estimate for its 2021 earnings climbed 8.6% over the past month to $8.81. You can see . the complete list of today’s Zacks #1 Rank stocks here Old Second Bancorp, Inc. ( OSBC Quick Quote OSBC - Free Report) currently carries a Zacks Rank of 2 (Buy). The Zacks Consensus Estimate for its 2021 earnings has been unchanged over the past 30 days at $1.32. UMB Financial Corporation ( UMBF Quick Quote UMBF - Free Report) carries a Zacks Rank of 2 at present. The Zacks Consensus Estimate for its 2021 earnings has been unchanged over the past 30 days at $7.04. More Stock News: This Is Bigger than the iPhone!
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