The transaction is expected to close in the first quarter, subject to the approval of Delanco shareholders.
Under the terms of the acquisition, Delanco shareholders will receive 1.11 shares of First Bank per share of Delanco common stock. First Bank, headquartered in Hamilton Township, expects to issue 1,049,422 in new shares of First Bank common stock to complete the transaction. Based upon First Bank’s Oct. 17 closing price of $12.75 per share, the transaction is valued at $14.15 per share.
Delanco Federal Savings Bank manages roughly $126 million, loans of $85 million and deposits of $111 million as of June. The merger, plus First Bank’s acquisition of Bucks County Bank last month, will give First Bank $1.6 billion in assets and 16 branches in New Jersey and Eastern Pennsylvania, according to an announcement.
First Bank already operates branches in Cranbury, Denville, Ewing, Flemington, Hamilton, Lawrence, Randolph, Somerset and Williamstown, and in Trevose, Doylestown, Warminster, Bensalem and Levittown townships in Pennsylvania. The bank managed roughly $1.2 billion as of June 30. The company specializes in deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor.
“We believe this to be another solid strategic transaction which expands our service footprint into Burlington County, an area with compelling customer demographics and excellent growth potential,” Patrick Ryan, First Bank CEO, said in a written statement. “In addition, this transaction will further strengthen our balance sheet by diversifying our loan portfolio and providing expanded access to cost-effective retail funding.”
Sandler O’Neill + Partners L.P. acted as financial advisor to First Bank and FinPro Capital Advisors acted as financial advisor to Delanco Bancorp Inc. Covington & Burling LLP provided legal counsel to First Bank and Kilpatrick Townsend & Stockton LLP provided legal counsel to Delanco Bancorp.