Creating a Preeminent Mid-Atlantic
Community Bank With Nearly $3 billion
in Assets
CAMP
HILL, Pa. and SALISBURY,
Md., Feb. 22, 2023 /PRNewswire/
-- LINKBANCORP, Inc. ("LINK") (NASDAQ: LNKB), parent company
of LINKBANK, and Partners Bancorp ("Partners") (NASDAQ: PTRS), a
financial services company with two wholly-owned operating
subsidiaries, The Bank of Delmarva and Virginia Partners Bank,
announced today that they have entered into a definitive agreement
under which the companies will combine in an all-stock combination,
valued at approximately $167.8
million, based on LINK's 10 day volume-weighted average
price of $8.08 as of February 21, 2023.
Under the terms of the agreement, which was unanimously approved
by the boards of directors of both companies, Partners shareholders
will receive 1.15 shares of LINK stock for each Partners share they
own. Upon completion of the transaction, Partners shareholders will
own approximately 56% and LINK shareholders, inclusive of shares
issued in a concurrent private placement of common stock, will own
approximately 44% of the combined company. In connection with the
transaction LINK has completed a private placement common stock
offering resulting in $10 million in
gross proceeds. Once the merger transaction is completed, the
combined organization will be a leading Mid-Atlantic community
banking franchise with nearly $3
billion in assets and an expected $300+ million market
capitalization.
The combined bank holding company will operate under the
LINKBANCORP, Inc. name, and the combined bank subsidiary will
operate as LINKBANK. Each of Partners' subsidiary banks will merge
with and into LINKBANK. The combined company will operate under
LINK's regional focused business model and Partners executives will
lead the Delmarva/Maryland,
Northern Virginia and Fredericksburg regions for the combined
entity. The corporate headquarters of the combined bank holding
company and combined bank entity will be located in Camp Hill, Pennsylvania, and will retain a
major operating presence in both Salisbury, Maryland and Fredericksburg, Virginia. The combined company
will trade under the LINKBANCORP, Inc. ticker symbol "LNKB" on The
Nasdaq Stock Market.
John W. Breda, President, CEO,
and Director of Partners Bancorp said, "This is an exciting
combination that accelerates our strategic objectives to create the
leading community bank headquartered in the Mid-Atlantic markets.
Importantly, LINK shares our values and relationship-based and
regional-focused business model. Our combined size and resources
will significantly enhance our scale and ability to help customers
through higher lending limits and greater investment in technology,
and will increase career opportunities for employees. I very much
look forward to partnering with the LINK team to grow our combined
organization."
Andrew S. Samuel, CEO and Vice
Chairman of LINKBANCORP said, "This is a transformational
partnership that will enhance what both banks are able to do for
our team members, clients, investors and communities, while driving
significant value for our shareholders. This merger significantly
accelerates each entity's size, profitability, and operating
leverage. We look forward to bringing our companies together to
better serve all stakeholders and achieve our mission of positively
impacting lives."
Governance and Leadership:
The combined company's board of directors will have twenty-two
directors, consisting of twelve directors from LINK and ten
directors from Partners.
Joseph C. Michetti, Jr., LINK's
current Chairman, will continue to serve as Chairman of the
combined company board of directors. Jeffery F. Turner, Partner's current Chairman,
will serve as Vice Chairman of the combined company board of
directors until September 2024, when
Mr. Turner will be appointed Chairman of LINK.
Under the leadership of Andrew
Samuel, LINK's Chief Executive Officer, the combined company
will be led by a well-respected management team that is comprised
of individuals with significant financial services and M&A
integration experience.
Below is a summary of the pro forma leadership team:
•
|
Andrew Samuel
(LNKB)
|
CEO
|
•
|
Carl Lundblad
(LNKB)
|
President
|
•
|
Kristofer Paul
(LNKB)
|
CFO
|
•
|
Brent Smith
(LNKB)
|
LINKBANK
President
|
•
|
Tiffanie Horton
(LNKB)
|
Chief Credit
Officer
|
•
|
Dee Bonora
(LNKB)
|
Chief Technology
Officer
|
•
|
John Breda
(PTRS)
|
Delmarva Market,
CEO
|
•
|
Adam Nalls
(PTRS)
|
Northern Virginia
Market, CEO
|
•
|
David Talebian
(PTRS)
|
Northern Virginia
Market, President
|
•
|
Wallace King
(PTRS)
|
Greater Fredericksburg
Market, President
|
Strategic Benefits of the Merger:
- Enhances scale and builds upon complementary strengths
- Scarcity value in highly coveted markets
- Like-minded culture and operating philosophy
- Wider product suite and customer service capabilities to
benefit existing relationships on both sides
- Shared history of investing in local communities
Financially Compelling to Both Sets of Shareholders:
- 23%+ GAAP EPS accretion in 2024 to LINK
- 50%+ GAAP EPS accretion in 2024 to Partners
- 2.7 years earnback time period of GAAP TBV dilution to
LINK
- 0.6 years earnback time period of TBV dilution excluding
AOCI/interest rate marks to LINK
- ~1.3% projected Pro Forma ROAA in 2024
- ~18% projected Pro Forma ROATCE in 2024
- Accelerates LINK's ROA in 2024 by 40+ bps
- 115% accretive to Partner's current cash dividends per
share
Timing and Approvals
The merger is expected to close in the third quarter of 2023,
subject to satisfaction of customary closing conditions, including
receipt of regulatory approvals and approval by the shareholders of
each company.
Advisors
Stephens Inc. is serving as exclusive financial advisor to LINK,
and has rendered a fairness opinion to the board of directors of
LINK. Luse Gorman, PC is serving as
legal advisor to LINK.
Piper Sandler & Co. is
serving as exclusive financial advisor to Partners Bancorp, and has
rendered a fairness opinion to the board of directors of Partners.
Troutman Pepper Hamilton Sanders,
LLP is serving as legal advisor to Partners Bancorp.
Joint Investor Conference Call
LINKBANCORP and Partners Bancorp will hold a joint conference
call to discuss the transaction at 10:00am ET on Thursday, February 23, 2023. To listen to the
live call, please dial 1-877-270-2148 within the U.S. and
1-412-902-6510 for all other locations and ask to be joined to the
LINKBANCORP, Inc. call. The link to the webcast is
https://event.choruscall.com/mediaframe/webcast.html?webcastid=pB79hhiC.
About LINKBANCORP, Inc.
LINKBANCORP, Inc. was formed in 2018 with a mission to
positively impact lives through community banking. Its subsidiary
bank, LINKBANK, is a Pennsylvania
state-chartered bank serving individuals, families, nonprofits and
business clients throughout Central and Southeastern Pennsylvania through 10 client
solutions centers and www.linkbank.com. LINKBANCORP,
Inc. common stock is traded on the Nasdaq Capital Market under the
symbol "LNKB". For further company information, visit
ir.linkbancorp.com.
About Partners Bancorp
Partners Bancorp is the holding company for The Bank of Delmarva
and Virginia Partners Bank. The Bank of Delmarva commenced
operations in 1896. The Bank of Delmarva's main office is in
Seaford, Delaware and it conducts
full service commercial banking through eleven branch locations in
Maryland and Delaware, and three branches, operating under
the name Liberty Bell Bank, in the
South Jersey/Philadelphia metro
market. The Bank of Delmarva focuses on serving its local
communities, knowing its customers and providing superior customer
service. Virginia Partners Bank, headquartered in Fredericksburg, Virginia, was founded in 2008
and has three branches in Fredericksburg,
Virginia and operates a full service branch and commercial
banking office in Reston,
Virginia. In Maryland,
Virginia Partners Bank trades under the name Maryland Partners Bank
(a division of Virginia Partners Bank), and operates a full service
branch and commercial banking office in La Plata, Maryland and a Loan Production
Office in Annapolis, Maryland.
Virginia Partners Bank also owns a controlling stake in Johnson
Mortgage Company, LLC, which is a residential mortgage company
headquartered in Newport News,
Virginia, with branch offices in Fredericksburg and Williamsburg, Virginia. For more information,
visit www.partnersbancorp.com, www.bankofdelmarvahb.com and
www.vapartnersbank.com.
LINKBANCORP, Inc.
Contact
|
|
Andrew
Samuel
CEO
717-798-4230
asamuel@LinkBank.com
|
|
|
|
Partners Bancorp
Contact
|
|
John W.
Breda
President, CEO, and
Director
410-548-1100 (ext.
10233)
jbreda@bankofdelmarva.com
|
|
FORWARD-LOOKING STATEMENTS
This communication includes "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended,
with respect to the beliefs, goals, intentions, and expectations of
LINK and Partners regarding the proposed transaction, revenues,
earnings, earnings per share, loan production, asset quality, and
capital levels, among other matters; our estimates of future costs
and benefits of the actions we may take; our assessments of
probable losses on loans; our assessments of interest rate and
other market risks; our ability to achieve our financial and other
strategic goals; the expected timing of completion of the proposed
transaction; the expected cost savings, synergies, returns and
other anticipated benefits from the proposed transaction; and other
statements that are not historical facts.
Forward–looking statements are typically identified by such
words as "believe," "expect," "anticipate," "intend," "outlook,"
"estimate," "forecast," "project," "will," "should," and other
similar words and expressions, and are subject to numerous
assumptions, risks, and uncertainties, which change over time.
These forward-looking statements include, without limitation, those
relating to the terms, timing and closing of the proposed
transaction.
Additionally, forward–looking statements speak only as of the
date they are made; LINK and Partners do not assume any duty, and
do not undertake, to update such forward–looking statements,
whether written or oral, that may be made from time to time,
whether as a result of new information, future events, or
otherwise. Furthermore, because forward–looking statements are
subject to assumptions and uncertainties, actual results or future
events could differ, possibly materially, from those indicated in
or implied by such forward-looking statements as a result of a
variety of factors, many of which are beyond the control of LINK
and Partners. Such statements are based upon the current beliefs
and expectations of the management of LINK and Partners and are
subject to significant risks and uncertainties outside of the
control of the parties. Caution should be exercised against placing
undue reliance on forward-looking statements. The factors that
could cause actual results to differ materially include the
following: the occurrence of any event, change or other
circumstances that could give rise to the right of one or both of
the parties to terminate the definitive merger agreement between
LINK and Partners; the outcome of any legal proceedings that may be
instituted against LINK or Partners; the possibility that the
proposed transaction will not close when expected or at all because
required regulatory, shareholder or other approvals are not
received or other conditions to the closing are not satisfied on a
timely basis or at all, or are obtained subject to conditions that
are not anticipated (and the risk that required regulatory
approvals may result in the imposition of conditions that could
adversely affect the combined company or the expected benefits of
the proposed transaction); the ability of LINK and Partners to meet
expectations regarding the timing, completion and accounting and
tax treatments of the proposed transaction; the risk that any
announcements relating to the proposed transaction could have
adverse effects on the market price of the common stock of either
or both parties to the proposed transaction; the possibility that
the anticipated benefits of the proposed transaction will not be
realized when expected or at all, including as a result of the
impact of, or problems arising from, the integration of the two
companies or as a result of the strength of the economy and
competitive factors in the areas where LINK and Partners do
business; certain restrictions during the pendency of the proposed
transaction that may impact the parties' ability to pursue certain
business opportunities or strategic transactions; the possibility
that the transaction may be more expensive to complete than
anticipated, including as a result of unexpected factors or events;
diversion of management's attention from ongoing business
operations and opportunities; the possibility that the parties may
be unable to achieve expected synergies and operating efficiencies
in the merger within the expected timeframes or at all and to
successfully integrate Partners' operations and those of LINK; such
integration may be more difficult, time-consuming or costly than
expected; revenues following the proposed transaction may be lower
than expected; LINK's and Partners' success in executing their
respective business plans and strategies and managing the risks
involved in the foregoing; the dilution caused by LINK's issuance
of additional shares of its capital stock in connection with the
proposed transaction; effects of the announcement, pendency or
completion of the proposed transaction on the ability of LINK and
Partners to retain customers and retain and hire key personnel and
maintain relationships with their suppliers, and on their operating
results and businesses generally; and risks related to the
potential impact of general economic, political and market factors
on the companies or the proposed transaction and other factors that
may affect future results of LINK and Partners; uncertainty as to
the extent of the duration, scope, and impacts of the COVID-19
pandemic on LINK, Partners and the proposed transaction; and the
other factors discussed in the "Risk Factors" section of each of
LINK's and Partners' Annual Report on Form 10–K for the year ended
December 31, 2021, in the "Risk
Factors" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" sections of each of LINK's and
Partners' Quarterly Report on Form 10–Q for the quarter ended
September 30, 2022, and other reports
LINK and Partners file with the U.S. Securities and Exchange
Commission (the "SEC").
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed transaction, LINK will file a
registration statement on Form S-4 with the SEC. The registration
statement will include a joint proxy statement of LINK and
Partners, which also constitutes a prospectus of LINK, that will be
sent to shareholders of LINK and shareholders of Partners seeking
certain approvals related to the proposed transaction.
The information contained herein does not constitute an offer to
sell or a solicitation of an offer to buy any securities or a
solicitation of any vote or approval, nor shall there be any sale
of securities in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction. INVESTORS AND
SECURITYHOLDERS OF LINK AND PARTNERS AND THEIR RESPECTIVE
AFFILIATES ARE URGED TO READ, WHEN AVAILABLE, THE REGISTRATION
STATEMENT ON FORM S-4, THE JOINT PROXY STATEMENT/PROSPECTUS TO BE
INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM S-4 AND ANY
OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC IN
CONNECTION WITH THE PROPOSED TRANSACTION, AS WELL AS ANY AMENDMENTS
OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT LINK, PARTNERS AND THE PROPOSED
TRANSACTION. Investors and security holders will be able to obtain
a free copy of the registration statement, including the joint
proxy statement/prospectus, as well as other relevant documents
filed with the SEC containing information about LINK and Partners,
without charge, at the SEC's website (http://www.sec.gov). Copies
of documents filed with the SEC by LINK will be made available free
of charge in the "Investor Relations" section of LINK's website,
https://ir.linkbancorp.com/, under the heading "SEC Filings."
Copies of documents filed with the SEC by Partners will be made
available free of charge in the "Investor Relations" section of
Partners' website,
https://www.partnersbancorp.com/investor-relations, under the
heading "SEC Filings."
PARTICIPANTS IN SOLICITATION
LINK, Partners, and certain of their respective directors and
executive officers may be deemed to be participants in the
solicitation of proxies in respect of the proposed transaction
under the rules of the SEC. Information regarding LINK's directors
and executive officers is available in its Amendment No. 1 to the
Annual Report on Form 10-K, which was filed with the SEC on
April 22, 2022, and certain other
documents filed by LINK with the SEC. Information regarding
Partners' directors and executive officers is available in its
definitive proxy statement, which was filed with the SEC on
November 2, 2022, and certain other
documents filed by Partners with the SEC. Other information
regarding the participants in the solicitation of proxies in
respect of the proposed transaction and a description of their
direct and indirect interests, by security holdings or otherwise,
will be contained in the joint proxy statement/prospectus and other
relevant materials to be filed with the SEC. Free copies of these
documents, when available, may be obtained as described in the
preceding paragraph.
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SOURCE LINKBANCORP, Inc.