Dive Overview:
Wheeling, West Virginia-based WesBanco has agreed to acquire Defiance, Ohio-based Premier Financial Corp. and its Youngstown-based banking subsidiary in a stock swap valued at about $959 million, the banks announced Friday..
The transaction, expected to close in the first quarter of 2025, will create a bank with approximately $26.9 billion in assets, $20.6 billion in deposits, $19.1 billion in loans and 250 branches across nine states, the banks said..
WesBanco plans to raise about $200 million in capital by Aug. 1 to support the merger, including a $125 million investment from Wellington Management, as well as investments from Glendon Capital Management and Claros Capital. Once the merger is complete, the investors will own 8% of the combined bank..
Dive Insights:
The acquisition of $8.8 billion in assets from Premier will add 73 branches and nine lending offices to WesBanco, expanding its footprint in northern Ohio, southern Michigan and northeastern Indiana. Premier currently has $7.2 billion in deposits and $6.8 billion in loans.
A quick look at WesBanco’s history reveals a long list of bank acquisitions, but Premier marks the West Virginia bank’s first acquisition in nearly five years.
WesBanco CEO Jeff Jackson called it “another milestone in our long-term growth strategy.”
“This transformational merger brings together two great institutions to create a community-focused, regional financial services partner powerfully positioned to serve the unique needs of both new and old communities,” said Jackson. “We look forward to delivering a superior customer experience to our new markets through our broad offering of banking and wealth management services.”
Premier shareholders will receive 0.80 shares of WesBanco common stock for each Premier common share they own, which works out to $26.66 per share based on WesBanco’s closing price of $33.32 on Wednesday. Premier shareholders are expected to own 30 percent of the combined company; former WesBanco shareholders will own 62 percent.
The banks said Friday that four of Premier’s directors will be appointed to WesBanco’s board of directors after the transaction closes.
“The combination of WesBanco and Premier is an excellent strategic fit. Both organizations are focused on local-level banking, are well aligned culturally and are driven by performance,” Premier CEO Gary Small said Friday. “The organizations’ expanded reach will be a catalyst for growth and increased investment in products and services to benefit all stakeholders: customers, associates, shareholders and the communities we serve.”
The banks said the transaction is expected to be more than 40% accretive to earnings in 2025. The combined company expects to recoup an estimated 13% of tangible book value dilution within three years, they said.
“WesBanco has built an outstanding reputation for integrity, profitability, customer service, being an employer of choice and community development,” Jackson said Friday. “We look forward to further expanding our tradition through this merger and creating even greater value for our customers, teams, communities and shareholders.”
