ACNB in Gettysburg, Pa., has agreed to buy Traditions Bancorp in York, Pa.
The $2.5 billion-asset ACNB said in a press release that it will pay $73.5 million in stock for the $859 million-asset Traditions. After the deal closes, Traditions’ shareholders will receive a quarterly cash dividend equal to about 23 cents a share.
The deal, which is expected to close in the first quarter, priced Traditions at 109% of its tangible book value.
ACNB “has been executing a multi-year strategic plan to be the community bank of choice in the markets that we serve and thereby deliver superior financial results, performance and value to our shareholders and other stakeholders,” James Helt, ACNB’s president and CEO, said in the release.
“At the core of this strategic plan has been profitable organic and inorganic growth,” he added. The acquisition “will provide the resources to expand our presence in York County and enhance our penetration in the vibrant and demographically compelling Lancaster County market”.
Three Traditions directors will join ACNB’s board, and Eugene Draganosky, Traditions’ chairman and CEO, will become vice chairman. Thomas Sposito II, Traditions’ president, will become president of the planned Traditions Bank division.
Traditions has eight branches, $738 million of deposits and $673 million of loans – two locations are expected to close. The current Traditions administrative headquarters will continue to serve as a regional sales and operations center.
The deal should be 29.1% accretive to ACNB’s 2025 earnings per share, including purchase accounting marks. It should take a little more than two years for ACNB to earn back an estimated 9.2% dilution to its tangible book value.
ACNB expects to incur $17.8 million of merger-related expenses. The company plans to cut about 35% of Traditions’ annual noninterest expenses.
Bybel Rutledge and Piper Sandler advised ACNB, while Hovde Group provided a fairness opinion. Pillar+Aught and Stephens advised Traditions.