PSBI buying IGAF for $13.55 share (closed at $11.75 Thurs)
PSB Bancorp, Inc. Announces Agreement to Acquire Jade Financial Corp.
PHILADELPHIA, Nov. 2 /PRNewswire/ -- PSB Bancorp, Inc. (NASDAQ/NMS: PSBI - news) and Jade Financial Corp. (NASDAQ/NMS: IGAF - news) announced today the execution of a definitive Agreement & Plan of Merger pursuant to which PSB will acquire Jade Financial Corp. and its wholly-owned subsidiary, IGA Federal Savings Bank in a cash transaction valued at approximately $24.1 million. Pursuant to the Agreement, PSB will purchase 100% of the outstanding shares of Jade Financial Corp. that PSB does not already own for $13.55 per share. All Jade shareholders, except its Employee Stock Ownership Plan (``ESOP''), will receive cash consideration. The Jade ESOP may receive cash, PSB stock or a combination of both. PSB will purchase its own shares in open market and privately-negotiated transactions in order to provide shares for the Jade ESOP.
In connection with the transaction, Jade's wholly-owned subsidiary IGA Federal Savings Bank will merge with and into PSB's wholly-owned subsidiary, First Penn Bank with the commercial bank charter of First Penn Bank surviving the merger.
The Agreement is subject to regulatory approval and the approval of Jade Financial Corp.'s shareholders.
Anthony DiSandro, President and COO of PSB, stated: ``We are delighted with this acquisition which represents a significant step in our commitment to profitably expand our franchise. The acquisition will be immediately accretive to our earnings per share. It will diversify our loan portfolio, bolster our core deposit base and will provide the customers of the combined company with a wide array of products and services. The acquisition will also expand our market presence in the counties surrounding Philadelphia.''
John J. O'Connell, Chairman of Jade Financial Corp. stated: ``We are very pleased with our affiliation a the growth oriented, community based organization like PSB Bancorp, Inc. We believe that this merger is in the best interests of our shareholders, depositors and customers of our bank.''
The transaction will be accounted for as a purchase for financial reporting purposes.
Repurchase of PSB Stock
As mentioned earlier, PSB intends to commence a share repurchase program for the purposes of funding the exchange of shares for Jade's ESOP. Based on current market pricing, PSB estimates that approximately 400,000 shares will be purchased in open market and privately-negotiated transactions. These shares may be reissued to the ESOP upon closing of the transaction. If PSB is unable to purchase enough shares for Jade's ESOP, the ESOP would receive cash for its shares and PSB would retire the repurchased shares.
Extension of Option Agreement
PSB and Lawrence Seidman have extended the term of the option agreement between the PSB and Mr. Seidman until December 31, 2000. The option agreement was signed on May 30, 2000 and was scheduled to expire on October 31, 2000. The agreement, as revised, gives PSB an option to purchase for $13.55 per share the 103,950 shares of Jade owned by Mr. Seidman.
PSB Third Quarter Earnings and Financial Condition
PSB today reported third quarter net income of $350,000, or $0.07 per share on a diluted basis. Net income for the nine months ended September 30, 2000 was $1.7 million, or $0.35 per share on a diluted basis. At September 30, 2000, PSB had total assets of $266.4 million, total deposits of $175.4 million, and shareholders' equity of $37.4 million. PSB is headquartered in Philadelphia and has seven offices in the Philadelphia metropolitan region.
Jade Third Quarter Earnings and Financial Condition
Jade today reported third quarter net income of $289,000, or $0.17 per share on a diluted basis. Net income for the nine months ended September 30, 2000 was $741,000, or $0.43 per share on a diluted basis. At September 30, 2000, Jade had total assets of $214.9 million, deposits of $187.1 million, and shareholders' equity of $27.7 million. Jade is headquartered in the Philadelphia suburb of Feasterville, PA and has five offices in the Philadelphia metropolitan region. |
