Teachers Credit Union (TCU) and New Bancorp, the holding company of New Buffalo Savings Bank, have signed an agreement under which TCU will acquire the assets and assume the liabilities of New Bancorp and New Buffalo in a deal valued at $21.3m.
Image: Teachers Credit Union to acquire New Bancorp. Photo: Courtesy of Capri23auto/Pixabay.
As of 31 December 2018, New Buffalo operates three bank branches in New Buffalo, Sawyer and Three Oaks, Michigan and had assets worth $119.5m.
With the latest acquisition, the total number of Teachers Credit Union branches will increase to 57 and total assets to about $3.2bn.
Pursuant to the definitive purchase and assumption agreement, New Bancorp shareholders will receive $28.42 per share in cash (which is subject to adjustment based on a minimum equity target) for each New Bancorp’s outstanding common share.
Upon closing of the deal, New Bancorp will settle its rest of the obligations and disburse the remaining transaction proceeds to its shareholders and all three banking locations will continue to operate as branches of Teachers Credit Union after the sale is finalized.
The acquisition was approved by the board of directors of both organizations and is expected to be closed in the second half of this year, subject to customary closing conditions and approval from New Bancorp’s shareholders and regulatory approvals.
Teachers Credit Union president and CEO Paul Marsh said: “We are excited to announce the acquisition of New Buffalo Savings Bank and look forward to welcoming their customers and employees into the TCU family.”
“This acquisition will allow us to expand our footprint and better serve our members in southwestern Michigan and it will result in better banking access for New Buffalo Savings Bank’s customers as well.
“I look forward to a positive transition as the cultures of both organizations are strong, and we share a commitment to the community and the members and customers we serve.”
Following the completion of the deal, it is estimated that New Buffalo’s corporate existence will be terminated and New Bancorp will be dissolved. The process could take up to 45 days after the sale has been completed.
New Bancorp and New Buffalo Savings Bank president and CEO Richard Sauerman said: “We are enthusiastic about our new partnership with TCU because of the expanded opportunities it brings to our customers, our employees and our community. TCU is a solid homegrown financial institution and this deal ensures that local banking will remain in our community.
“We are also appreciative of the support from our shareholders, and we believe that this transaction will be beneficial for them.”
Keefe, Bruyette, & Woods and Luse Gorman, PC represent New Bancorp on the transaction, while TCU is being represented by Boenning & Scattergood and Krieg DeVault.