Standard Financial Corp. (STND), Allegheny Valley (AVLY) Agree to Merge
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Standard Financial Corp. (OTC: STND) ("Standard Financial"), the parent holding company for Standard Bank, PaSB ("Standard Bank") and Allegheny Valley Bancorp, Inc. (OTC: AVLY) ("Allegheny Valley Bancorp"), the parent holding company for Allegheny Valley Bank of Pittsburgh ("Allegheny Valley Bank"), jointly announced today the signing of a definitive merger agreement to form a partnership of their financial institutions that will result in a combined community banking franchise with total assets of nearly $1.0 billion and 18 branches located throughout Southwestern Pennsylvania and Western Maryland. The combined company will operate under the Standard Bank name while incorporating the Allegheny Valley Bank logo to provide both banks' customers with a sense of familiarity. The holding company will be re-branded as Standard AVB Financial Corp.
The resulting holding company and bank will be led by Timothy K. Zimmerman, President and Chief Executive Officer of Standard Bank, as Chief Executive Officer, and Andrew W. Hasley, President and Chief Executive Officer of Allegheny Valley Bank, as President. Six existing members of the Allegheny Valley Bancorp board of directors will join the boards of Standard Financial and Standard Bank, creating a board consisting of 13 members.
The terms of the merger agreement have been unanimously approved by the boards of directors of both institutions. Allegheny Valley Bancorp will merge into Standard Financial and Allegheny Valley Bank will merge into Standard Bank. Allegheny Valley Bancorp shareholders will receive 2.083 shares of Standard Financial common stock for each share of Allegheny Valley Bancorp common stock they own in a transaction structured to qualify as a tax-free reorganization under the Internal Revenue Code. Based on the closing price of Standard Financial on August 29, 2016, the aggregate transaction value is approximately $56.5 million, or $53.85 per share. As a provision of the merger, the new combined holding company will continue to pay a cash dividend that, adjusted for the merger exchange ratio, provides Allegheny Valley Bancorp shareholders with the same economic value of Allegheny Valley Bancorp's current annual cash dividend of $1.84 per share. This will represent a significant increase in dividends for Standard Financial shareholders.
The transaction is subject to approval by the shareholders of Standard Financial and Allegheny Valley Bancorp, as well as customary regulatory approvals, including the Pennsylvania Department of Banking and Securities and the FDIC. Pending the receipt of regulatory and shareholder approvals, the merger is expected to close in the first quarter of 2017. All of the directors and executive officers of Standard Financial and Allegheny Valley Bancorp have entered into voting agreements pursuant to which they have agreed to vote their shares in favor of the merger.
With nine branches and $485 million in assets as of June 30, 2016, Standard Financial brings a strong retail banking focus to the combined bank. "Community banks are an integral part of the financial services landscape that provide high quality, personalized service to small businesses and the retail banking market. We believe our merger of equals with Allegheny Valley Bank will strengthen and expand our commitment to community banking for communities in Southwestern Pennsylvania and Western Maryland." said Mr. Zimmerman.
Allegheny Valley Bank has established an expertise in commercial banking that will continue in the combined bank. "Our history in our community dates back to 1900," said Mr. Hasley. "The two banks are very complimentary and this merger allows us to preserve Allegheny Valley Bank's core culture and to remain a community oriented bank serving the Pittsburgh market. We look forward to partnering with the Standard Bank team as we build the community bank of choice. We see this merger of equals as an opportunity to grow our capital base, increase our ability to serve the lending needs of our growing customer base, and offer additional products and services over a larger branch network. We believe our customers will react favorably to the merger as they will continue to see the same high level of service from familiar faces"
The combined bank plans to maintain its headquarters in Monroeville while maintaining a significant presence in Allegheny Valley Bank's Lawrenceville headquarters. This will be the primary hub from which the commercial banking staff will work. Based on June 30, 2016 financial information, the combined bank will have total loans of $666 million, $674 million in deposits, and will service more than 50,000 deposit and loan accounts through 18 branches in Allegheny, Bedford, and Westmoreland Counties in Pennsylvania and Allegany County in Maryland.
Keefe, Bruyette, & Woods, Inc. served as financial advisor and Luse Gorman, PC provided legal counsel to Standard Financial. Boenning & Scattergood, Inc. served as financial advisor and Bybel Rutledge LLP served as legal counsel to Allegheny Valley Bancorp.
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Create E-mail Alert Related CategoriesCorporate News, Mergers and Acquisitions
Related EntitiesBoenning & Scattergood, Dividend, FDIC, Definitive Agreement
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