Old Second Bancorp in Aurora, Ill., has agreed to buy five Chicago-area branches from First Merchants in Muncie, Ind.
The $5.7 billion-asset Old Second said in a press release that it will gain $304 million of deposits and $12 million of loans. The company will pay a 7.5% deposit premium, or roughly $23 million, in cash.
The purchase is expected to close near the end of this year.
The deal should be 5% accretive to Old Second’s 2025 and 2026 earnings per share. It should take less than three years to earn back an estimated 4.4% dilution to the company’s tangible book value.
Keefe, Bruyette & Woods and Nelson Mullins Riley & Scarborough advised Old Second. Stephens and Dentons Bingham Greenebaum advised First Merchants.