HONESDALE, Pa. and GENEVA, N.Y., Jan. 09, 2020 (GLOBE NEWSWIRE) -- Norwood Financial Corp. (Nasdaq Global Market - NWFL), the holding company for Wayne Bank, Honesdale, Pennsylvania, and UpState New York Bancorp, Inc., the holding company for USNY Bank, Geneva, New York, jointly announced today the signing of a definitive merger agreement pursuant to which Norwood Financial Corp. (“Norwood”) will acquire UpState in a stock and cash transaction. The transaction will extend Norwood’s footprint into Ontario, Otsego and Yates Counties, New York. The combined company will have approximately $1.7 billion in assets and 31 offices throughout five counties in Northeastern Pennsylvania, two counties in the Southern Tier of New York and three counties in upstate New York.
"We are pleased to be able to partner with UpState and USNY Bank. Both of our companies have earned a great reputation in the market and have a common community banking culture. The merger will give us a presence in the Upstate New York Counties of Ontario, Otsego and Yates. This acquisition will offer expanded products and services to the USNY Bank customer base and will extend our reach from the Southern Tier of New York to Upstate New York," noted Lewis J. Critelli, President and Chief Executive Officer of Norwood. R. Michael Briggs, President of UpState stated “We are delighted to provide our customers, shareholders and employees with the opportunity to partner with Wayne Bank. They are a high-quality community bank. The added depth and breadth of the merged companies will enable us to enhance the customer experience through greater product offerings and provide career growth for our employees while delivering value for our shareholders.” Under the terms of the merger agreement, which has been unanimously approved by the boards of directors of both companies, Norwood will acquire all of the outstanding shares of UpState. In addition, USNY Bank will merge with and into Wayne Bank, with Wayne Bank as the surviving entity. Pursuant to the terms of the merger agreement, shareholders of UpState will have the opportunity to elect to receive for each share of UpState common stock they own, either 0.9390 shares of Norwood common stock or $33.33 in cash, or a combination of both. All shareholder elections will be subject to the allocation and proration procedures set forth in the merger agreement which are intended to ensure that 90% of the shares of UpState will be exchanged for Norwood common stock and 10% of the shares of UpState will be exchanged for cash. In addition to the purchase price per share, UpState may also be permitted, under certain performance conditions, to distribute at the closing of the merger, a special cash dividend of up to an additional $0.67 per share to UpState’s shareholders. The transaction is expected to be a tax-free exchange for shareholders of UpState receiving Norwood common stock.
Based on Norwood’s January 8, 2020 closing price of $38.93 per share, the transaction is valued at approximately $80.00 million. The transaction value represents 176.8% of UpState’s tangible book value at September 30, 2019, 16.1 times UpState's earnings per share for the latest twelve months ended September 30, 2019, and a 13.1% core deposit premium.
Lewis J. Critelli, President and Chief Executive Officer of Norwood will remain as President and Chief Executive Officer of the combined company. All members of the Executive Management team of Norwood and Wayne Bank will continue in their current positions.
UpState directors Jeffrey S. Gifford and Alexandra K. Nolan will be appointed to the boards of directors of Norwood and Wayne Bank. In addition, the other directors of UpState will be invited to join a regional advisory board. UpState President and CEO R. Michael Briggs will enter into a consulting agreement with Wayne Bank. Norwood will retain the brand names of USNY’s two units, Bank of the Finger Lakes and Bank of Cooperstown, and will also retain USNY’s administration center in Geneva, New York. Scott D. White, unit President of Bank of Cooperstown, and Jeffrey E. Franklin, unit President of Bank of the Finger Lakes, will also remain in place as executives of their units.
About Norwood Financial Corp.
Headquartered in Honesdale, PA, Norwood Financial Corp, through its subsidiary, Wayne Bank operates fifteen offices in Northeastern Pennsylvania and twelve offices in Delaware and Sullivan Counties, New York. As of September 30, 2019, Norwood had total assets of $1.2 billion, loans outstanding of $905.6 million, total deposits of $974.4 million and total stockholders’ equity of $134.9 million. Norwood’s stock is traded on the Nasdaq Global Market under the symbol “NWFL”.
About UpState New York Bancorp, Inc.
UpState New York Bancorp, Inc. is the holding company for USNY Bank, a New York chartered bank that conducts its business from its two Bank of the Finger Lakes offices in Geneva and Penn Yan, New York, and two Bank of Cooperstown offices in Cooperstown and Oneonta, New York. As of September 30, 2019, UpState had total assets of $435.9 million, total net loans of $379.2 million, total deposits of $387.1 million and total stockholders' equity of $45.3 million.
