WHEELING - WesBanco and Fidelity Bancorp Friday announced an agreement and plan of merger.
Under the terms of the agreement, WesBanco will exchange common stock and cash for Fidelity common stock. Fidelity shareholders will be entitled to receive .8275 shares of WesBanco common stock and $4.50 per share for each share of Fidelity common stock.
The transaction, approved by the directors of both companies, is valued at $70.8 million. It is expected that the transaction will be completed late in the fourth quarter of 2012 or in early 2013.
A joint announcement was released on Friday.
"We are extremely pleased to have the opportunity to expand our Pittsburgh market through our merger with Fidelity, a well-managed, profitable company located in many established market areas in Pennsylvania. Fidelity's branches are strategically located in areas that add to WesBanco's branches in Western Pennsylvania. Their banking locations and access to business opportunities in markets projected for population growth over the next five years will significantly diversify WesBanco's customer base and product distribution. Furthermore, this merger provides approximately $550 million of deposits in the Western Pennsylvania market." James C. Gardill, chairman of the board of WesBanco, said.
"Our affiliation with WesBanco will maintain a level of local decision making through employee and management retention while providing an enhanced product and service array. That leads to improvements in customer service and improved opportunities for our employees. In our markets, supporting our local communities while providing a larger regional presence will continue to differentiate us from our super-regional competitors. The combined strength of WesBanco and Fidelity affords us a great opportunity to compete and service our customers," Christopher S. Greene, Fidelity chairman of the board, Green said. "It became very clear early on that WesBanco's vision for the future fit extremely well with our own business plan and our desire to maintain our strong reputation and community standing. WesBanco shares our vision for the future," he continued.
"WesBanco's extensive experience in trusts and investments, commercial lending and technologically advanced banking systems were important factors in determining the merger potential of the combined organization," said Richard G. Spencer, president and CEO of Fidelity. "We operate in some very attractive markets that are the homes to Fortune 500 companies. By aligning ourselves with WesBanco, we become a formidable competitor for business in Western Pennsylvania. As part of WesBanco, with our more significant combined resources, we can now compete for larger commercial and retail transactions and offer improved trust and wealth related services. We look forward to providing our customers the same types of products that are offered by the super-regional competitors in our markets while we maintain the community bank orientation necessary to compete with the other financial institutions that serve our markets," Mr. Spencer said.
At March 31, 2012, WesBanco had consolidated assets of $5.6 billion, deposits of $4.5 billion, loans of $3.2 billion and shareholders' equity of $642 million.
At March 31, 2012, Fidelity had consolidated assets of $666 million, deposits of $471 million, loans of $341 million and shareholders' equity of $52 million.
When the transaction is consummated, the combination of the two banking companies will create a bank with approximately $6.3 billion in assets providing banking services through 125 locations and 120 ATM's in three states. The transaction will expand WesBanco's franchise by 13 offices located along the Rt. 19 corridor North, South and through the city of Pittsburgh.
As a result of the merger, it is anticipated that WesBanco will add Spencer to its board. All of the directors and executive officers of Fidelity have entered into voting agreements with WesBanco pursuant to which they have agreed to vote their shares in favor of the transaction.
"Retaining key employees and ties to the communities served by Fidelity will be extremely important in our ability to effect a smooth transition for Fidelity customers," said Paul M. Limbert, president and CEO of Wesbanco. "Given the attractive markets served by Fidelity, it is important that we retain as much continuity in service and leadership as possible. These are areas that we are particularly interested in as we prepare to offer WesBanco products and services. For 85 years, Fidelity has operated a successful franchise by concentrating on its customers and its communities. It is important that Fidelity customers continue to be served by familiar faces in their markets."
Investment advisors involved in the transaction were Macquarie Capital (USA), Inc., representing WesBanco, and Mufson Howe Hunter & Company, LLC, representing Fidelity. Legal representation in the transaction are Phillips Gardill Kaiser & Altmeyer PLC and K&L Gates LLP for WesBanco and Spidi & Fisch, PC for Fidelity.