Banks in Pennsylvania set to unite in a $54.9 million merger agreement
In a significant move, Norwood Financial Corp has announced its agreement to buy PB Bankshares and its subsidiary, Presence Bank, in a deal valued at $54.9 million. The merger is expected to close late in the fourth quarter of 2025 or early in the first quarter of 2026.
The deal, which is a combination of 80% stock and 20% cash, will see Presence Bank merge into Wayne Bank. The transaction is anticipated to be roughly 10% accretive to earnings per share in 2026 while leading to a 4.2% tangible book value dilution at closing and a tangible book value earn back period of 21⁄2 years.
Presence shareholders will have the option to receive either 0.7850 shares of Norwood common stock per Presence share or $19.75 in cash per Presence share. This decision will give Presence shareholders roughly 14% ownership of the combined company after the merger's completion.
Selected Presence executives, including CEO Janak Amin, will remain with Norwood after the merger. Amin will join Wayne Bank as executive vice president and chief operating officer. Two non-employee Presence Bank board members will also join the Norwood and Wayne Bank boards for specified terms.
The deal value was determined based on Norwood's share price as of July 3. No new information about the percentage of ownership Presence shareholders will have post-merger was provided. Furthermore, no new licensing rights information was provided, and no new information about the dividends for Presence shareholders was disclosed.
However, one aspect that remains unclear is the terms and conditions of non-compete agreements for executives joining Norwood Financial Corp from Presence Bank post-merger. While such agreements are common in bank mergers, the exact terms, duration, scope, or geographic limits of these agreements remain unknown without explicit documentation or disclosure from Norwood Financial Corp or PB Bankshares/Presence Bank.
Interestingly, Presence shareholders receiving stock will enjoy quarterly dividends of roughly $0.24 per share, representing a 3.6% yield. The combined entity after the transaction will have $3 billion in assets.
Janak Amin expects the deal to provide an enhanced customer experience for Presence's commercial base and opportunities to expand retail business with Norwood's product set and consumer verticals.
For more precise details on the non-compete agreements, one would likely find them in the official merger or acquisition agreements filed with regulators, employment contracts or offer letters provided post-merger to executive personnel, or confidential internal documents that may not be publicly available.
The merger between Presence Bank and Wayne Bank, facilitated by Norwood Financial Corp, will involve the banking-and-insurance industry, as well as business and finance, given the transaction's financial value and the anticipated impact on earnings per share. Following the deal's closure, Presence shareholders who opt for Norwood common stock will earn quarterly dividends within the industry, offering a 3.6% yield.
