M and A

US Bank Adds Multi-Family Office, Wealth Manager Via Acquisition

Thomas Coyle New York 31 July 2009

US Bank Adds Multi-Family Office, Wealth Manager Via Acquisition

First Niagara Financial Group, an acquisitive community bank based in Lockport, New York, has agreed to buy Harrisburg, Pennyslyvania-based Harleysville National Corporation, which owns Harleysville National Bank, East Penn Bank, Millennium Wealth Management and the multi-family office Cornerstone.

First Niagara says the acquisition is in keeping with its strategy of buying into markets with attractive demographics and long-term growth potential.

The all-stock deal gives First Niagara 83 bank branches in and around Philadelphia and in eastern Pennsylvania's Lehigh Valley, assets of $5.6 billion and deposits of $4.1 billion as well as the investment and wealth management and trust services of Millenium and Cornerstone, which have offices in Allentown, Bethlehem, Lansdale and Spring House in Pennsylvania and in Wilmington, Delaware, and combined assets under management of around $2.5 billion.

"The communities served by Harleysville are perfect complements to First Niagara's stable and resilient markets in upstate New York and western Pennsylvania," says First Niagara's president and CEO John Koelmel.

The $237-million price First Niagara has agreed to pay amounts to a premium 37.5 per cent on Harleysville's stock price as of last Friday's close.

Using First Niagara's 22 July 2009 closing stock price of $11.60 as the exchange ratio, the deal calls for Harleysville shareholders to receive 0.474 shares of First Niagara common stock per Harleysville share.

The exchange ratio is in this case subject to adjustment if loan delinquencies at Harleysville exceed specified amounts.

Register for WealthBriefing today

Gain access to regular and exclusive research on the global wealth management sector along with the opportunity to attend industry events such as exclusive invites to Breakfast Briefings and Summits in the major wealth management centres and industry leading awards programmes