By Lisa Kerner
Charlotte, N.C., May 16 - East Penn Financial Corp. agreed to merge with and into Harleysville National Corp. in a transaction valued at $92.7 million, or about $14.50 per share.
The companies' definitive agreement also calls for East Penn Financial's wholly owned subsidiary, East Penn Bank, to merge with and into Harleysville National Bank and Trust Co.
Under the agreement, the price per share will be between $13.52, or a total value of $86.3 million, and $15.48, or $99.1 million in total. The final per-share price will be determined based on a formula that includes the average per-share value of Harleysville National stock during the 20-day period ending 11 days prior to closing.
East Penn Financial shareholders may elect to receive either cash or Harleysville National shares for each share of East Penn Financial in the transaction, which is expected to close in the fall of 2007.
"Our opportunity to affiliate ourselves with Harleysville National Corp. is a perfect fit for our company," East Penn chairman and chief executive officer Brent Peters said in a company news release.
Peters will continue with Harleysville National as an executive officer and president of the East Penn Bank division. In addition, Peters will join the Harleysville National and Harleysville National Bank boards of directors.
East Penn Bank will continue to operate under its current name and logo as a division of Harleysville National.
Harleysville National was advised by Janney Montgomery Scott LLC and Stradley Ronon Stevens & Young, LLP. East Penn Financial was advised by Sandler O'Neill and Partners, LP and Bybel Rutledge LLP.
Harleysville National, located in Harleysville, Pa., is the holding company for Harleysville National Bank.
East Penn Financial is a bank holding company based in Emmaus, Pa.
| Acquirer: | Harleysville National Corp.
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| Target: | East Penn Financial Corp.
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| Transaction value: | $92.7 million
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| Price per share: | Between $13.52 and $15.48
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| Announcement date: | May 16
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| Expected closing: | Fall of 2007
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| Stock price for acquirer: | Nasdaq: HNBC: $14.83 on May 15
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| Stock price for target: | Nasdaq: EPEN: $8.09 on May 15
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