Harleysville National (HNBC) Announces Acquisition of Willow Financial (WFBC)

May 21, 2008 8:49 AM EDT

Harleysville National Corporation (Nasdaq: HNBC) and Willow Financial Bancorp, Inc. (Nasdaq: WFBC) have reached a definitive agreement for Willow Financial Bancorp to merge with and into HNC. Willow Financial Bancorp's wholly owned subsidiary, Willow Financial Bank, a $1.6 billion savings bank with 29 banking offices in Southeastern Pennsylvania, will merge with and into Harleysville National Bank and Trust Company (HNB), HNC's banking subsidiary. Headquartered in King of Prussia, PA, Willow Financial Bank branch offices are located in Philadelphia, Montgomery, Chester, and Bucks Counties.

Under the merger agreement, which has been unanimously approved by the boards of directors of both companies, each share of Willow Financial Bancorp common stock will be exchanged for 0.73 shares of HNC common stock. Based upon HNC's closing share price as of May 20, 2008, the transaction equates to approximately $10.28 per Willow Financial Bancorp share, for a total transaction value of approximately $162 million. Following the transaction, current HNC shareholders will own approximately 73% and current Willow Financial Bancorp shareholders 27% of the combined company. The transaction is subject to regulatory and shareholder approval and is expected to close in the fourth quarter.[SM]

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