WHEELING - WesBanco says its proposed merger with Fidelity Bancorp, a transaction valued at $70.8 million, would strengthen its position in the Pittsburgh market.
The transaction has been approved by directors of both companies, though the deal is subject to approvals by banking regulatory authorities as well as Fidelity's shareholders. Bank officials are expected to complete the transaction late in the fourth quarter or in early 2013.
Under the terms of the agreement, Fidelity shareholders will receive 0.8725 shares of WesBanco common stock and $4.50 in cash per share for each share of Fidelity common stock they hold, with the exchange ratio based on the average closing price of WesBanco shares over a 15-day period prior to the announcement.
In a news release, WesBanco Chairman James C. Gardill described Fidelity as "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," he added. "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."
Fidelity's chairman, Christopher S. Green, said the affiliation "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," he added. "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.
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."
Fidelity President and CEO Richard G. Spencer said the banks 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," he said.
As of March 31, WesBanco had consolidated assets of $5.6 billion, deposits of $4.5 billion, loans of $3.2 billion and shareholders' equity of $642 million, while Fidelity pegged its consolidated assets of $666 million, deposits of $471 million, loans of $341 million and shareholders' equity of $52 million.
When the transaction is complete, the combination of the two banking companies will create a bank with about $6.3 billion in total assets providing banking services through 125 locations and 120 ATMs in three states.
With the merger, Spencer is expected to join the WesBanco board. Both companies are looking for a smooth transition focused on customer service and product delivery.
"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 WesBanco President and CEO Paul M. Limbert. "Given the attractive markets served by Fidelity, it is important that we retain as much continuity in service and leadership as possible."