S&T Bancorp, Inc. – the Indiana, Pa.-based holding company for S&T Bank, with operations in five markets including western Pennsylvania, central Pennsylvania, northeast Ohio, central Ohio, and upstate New York – and DNB Financial Corporation have signed a definitive merger agreement pursuant to which S&T will acquire DNB in an all-stock transaction.
DNB shareholders will receive 1.22 shares of S&T stock for each share of DNB stock. Based on S&T’s closing price of $38.75 per share on June 4, the transaction will have an aggregate value of approximately $206 million, or $47.28 per share. The merger will expand S&T’s footprint into southeastern Pennsylvania, gaining a new presence in Chester, Delaware, and Philadelphia counties. On a combined basis, S&T will have approximately $8.4 billion in total assets.
“I am very pleased to announce our merger with DNB, a nearly 160-year-old institution which shares the values, culture, and commitment to high quality customer service found at S&T Bank,” said Todd D. Brice, CEO of S&T. “Merging with such a venerable institution located in a growing southeastern Pennsylvania market dovetails nicely with our expansion into the central Pennsylvania market in 2015, and our overall strategic growth strategy focused on Pennsylvania, Ohio, and New York. Alongside DNB’s seasoned staff, we look forward to building on the bank’s legacy, as well as working with existing and future clients.”
“This combination represents a great opportunity for DNB’s four constituents – our shareholders, customers, communities, and employees; it is a natural cultural fit,” said William J. Hieb, President and CEO of DNB. “S&T is a high-performing company, as evidenced by its superior earnings and consistently high-dividend payments, proven management team, and 100-plus-year history of responsiveness to the customers and communities it serves. With S&T, our customers will continue to enjoy all the benefits of a relationship-driven bank, with access to continued technology investments, expanded lending capacity, and a deeper and broader range of financial products and services.”
The terms of the merger agreement have been unanimously approved by the boards of directors of both companies. The transaction is expected to be a tax-free exchange to the shareholders of DNB.
S&T expects the merger to be accretive to earnings per share in 2020. S&T and DNB expect to complete the transaction during the fourth quarter of 2019 after satisfaction of customary closing conditions, including regulatory approvals and the approval of the shareholders of DNB.