Establishes foothold in Greater Cleveland market through entry into
Mentor
CLEARFIELD, Pa.--(BUSINESS WIRE)--
CNB Financial Corporation (NASDAQ: CCNE), the parent company of CNB
Bank, today announced that it has entered into a definitive agreement to
acquire Lake National Bank of Mentor, Ohio, for $22.50 per share in
cash, or approximately $24.75 million in the aggregate. Lake National
Bank, which was founded in 2005 by the late Lake County businessman and
philanthropist Jerome T. Osborne, Sr., had approximately $152.2 million
in total assets and $14.1 million in shareholders’ equity as of
September 30, 2015.
Following completion of the merger, the business of Lake National Bank
will operate as part of the ERIEBANK division of CNB. The ERIEBANK
division, led by David J. Zimmer III, has local decision making and
oversight with a presence throughout Erie, Warren and Crawford Counties
in Pennsylvania and Ashtabula County in Ohio. ERIEBANK was established
in 2005 and has grown successfully from a de novo operation to 9
locations and over $652 million in total assets in approximately 10
years. In 2014, ERIEBANK opened a loan production office in Ashtabula,
Ohio, a neighboring community to Mentor, and is currently constructing a
full service location in that market.
It is anticipated that customer-facing personnel at Lake National Bank
will be largely unaffected, and ERIEBANK plans to grow its business
origination effort in Lake County following closing and integration of
the transaction. Andrew Meinhold, currently President and Chief
Executive Officer of Lake National Bank, will continue with CNB in its
ERIEBANK division following closing of the merger. Following
consummation of the merger, Jerome T. Osborne III and Lance F. Osborne
will be joining the Advisory Board of ERIEBANK, and Joseph T. Svete,
Chairman of Lake National Bank, Richard T. Flenner, Jr., Vice Chairman
of Lake National Bank, and Richard J. Kessler, Director of Lake National
Bank, will begin the ERIEBANK OH Advisory Board of the ERIEBANK division
of CNB.
“We are excited to continue expansion of our franchise in Ohio by
entering the Mentor market in the greater Cleveland area,” announced
Joseph B. Bower, Jr., President and CEO of CNB Financial Corporation.
“We have been targeting Mentor as a logical expansion of our ERIEBANK
franchise, following up on our most recent expansion into Ashtabula.
Mentor is known for its mid-sized commercial and industrial businesses,
which we serve extremely well. We feel the same opportunity exists in
the greater Cleveland market as in the greater Columbus market, where we
also purchased a smaller institution that will allow us to grow
organically. We are especially privileged to partner with the Osborne
family to continue to serve consumers and small businesses while
providing the high level of customer service, which was so important to
Jerome Sr. and was the basis upon which he began this bank.”
David J. Zimmer III, President of ERIEBANK, added, “Our ERIEBANK
franchise was founded upon many of the same principles that Jerome Sr.
founded Lake National. We have the optimal combination of prompt local
decision making and oversight, with the product, service and operational
support of CNB. We are thrilled with this combination, and excited to
provide employees a meaningful and challenging opportunity within our
organization, and to provide customers of Lake National with the superiorcustomer service and product selection that they have come to
expect.”
“CNB is the ideal partner for our bank,” said Andrew L. Meinhold,
President and Chief Executive Officer of Lake National Bank. “CNB has a
successful community banking model and specializes in serving the small
and medium sized businesses that are headquartered in Mentor and our
surrounding areas. We take pride in being the only locally-owned bank in
our market, and we expect that the ERIEBANK brand, combined with a
larger lending limit, products, services and technology of CNB, will
further enhance our community banking model and serve our new and
existing customers extremely well.”
The transaction is expected to be accretive to the earnings per share of
CNB in the first full year of operations. On a pro forma basis, the
combined company will have over $2.5 billion in assets and 40
full-service offices in central and western Pennsylvania and northern
and central Ohio. The transaction is expected to close in the third
quarter of 2016, subject to customary closing conditions, including
regulatory approvals and the approval of Lake National Bank shareholders.
CNB Financial Corporation will furnish a summary investor presentation
as part of its filing with the SEC on Form 8-K announcing the proposed
merger.
Griffin Financial Group, LLC is acting as financial advisor to CNB
Financial Corporation, and Hogan Lovells US, LLP is acting as legal
counsel. Lake National Bank is being advised by Boenning & Scattergood,
Inc. and its legal counsel is Dinsmore & Shohl LLP.
About CNB Financial Corporation
CNB Financial Corporation is a financial holding company with
consolidated assets of approximately $2.3 billion that conducts business
primarily through CNB Bank, CNB’s principal subsidiary. CNB Bank is a
full-service bank engaging in a full range of banking activities and
services, including trust and wealth management services, for
individual, business, governmental, and institutional customers. CNB
Bank operations include a private banking division, loan production
offices in Hollidaysburg, Pennsylvania and Ashtabula, Ohio, and 29
full-service offices in Pennsylvania, including ERIEBANK, a division of
CNB Bank, as well as 9 full-service offices in central Ohio conducting
business as FCBank, a division of CNB Bank. More information about CNB
and CNB Bank may be found on the internet at www.bankcnb.com.
About Lake National Bank
Lake National Bank, a privately held financial institution headquartered
in Mentor, Ohio, was founded in 2005 and is Lake County’s only locally
owned and operated bank. Lake National Bank operates two offices, both
in Mentor, and serves both small business and consumer customers with a
focus on real estate and commercial lending. Lake National offers a full
line of retail and commercial banking services, including online
banking, bill pay and remote deposit.
Forward-Looking Statements
This press release contains statements that may be considered
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. These forward-looking statements are intended to be covered by the
safe harbor provisions of the Private Securities Litigation Reform Act
of 1995, and this statement is included for purposes of complying with
these safe harbor provisions. Readers should not place undue reliance on
such forward-looking statements, which speak only as of the date made.
These forward-looking statements are based on current plans and
expectations, which are subject to a number of risk factors and
uncertainties that could cause future results to differ materially from
historical performance or future expectations. These differences may be
the result of various factors, including, among others: (1) failure of
the parties to satisfy the closing conditions in the merger agreement in
a timely manner or at all; (2) failure of the shareholders of Lake
National Bank to approve the merger agreement; (3) failure to obtain
governmental approvals for the merger; (4) disruptions to the parties'
businesses as a result of the announcement and pendency of the merger;
(5) costs or difficulties related to the integration of the business
following the proposed merger; (6) the risk that the anticipated
benefits, cost savings and any other savings from the transaction may
not be fully realized or may take longer than expected to realize; (7)
changes in general business, industry or economic conditions or
competition; (8) changes in any applicable law, rule, regulation,
policy, guideline or practice governing or affecting financial holding
companies and their subsidiaries or with respect to tax or accounting
principles or otherwise; (9) adverse changes or conditions in the
capital and financial markets; (10) changes in interest rates or credit
availability; (11) the inability to realize expected cost savings or
achieve other anticipated benefits in connection with the proposed
merger; (12) changes in the quality or composition of loan and
investment portfolios; (13) adequacy of loan loss reserves and changes
in loan default and charge-off rates; (14) increased competition and its
effect on pricing, spending, third-party relationships and revenues;
(15) loss of certain key officers; (16) continued relationships with
major customers; (17) deposit attrition, necessitating increased
borrowings to fund loans and investments; (18) rapidly changing
technology; (19) unanticipated regulatory or judicial proceedings and
liabilities and other costs; (20) changes in the cost of funds, demand
for loan products or demand for financial services; and (21) other
economic, competitive, governmental or technological factors affecting
operations, markets, products, services and prices.
The foregoing list should not be construed as exhaustive, and CNB
Financial Corporation and Lake National Bank undertake no obligation to
subsequently revise any forward-looking statements to reflect events or
circumstances after the date of such statements, or to reflect the
occurrence of anticipated or unanticipated events or circumstances.
For additional factors that could cause actual results to differ
materially from those expressed in the forward-looking statements,
please see filings by CNB Financial Corporation with the SEC, including
CNB Financial Corporation’s Annual Report on Form 10-K for the year
ended December 31, 2014.
Additional Information About the Transaction
In connection with the proposed transaction, Lake National Bank will
distribute a proxy statement to its shareholders in connection with a
special meeting of shareholders to be called and held for the purposes
of voting on approval of the transaction and related matters.
BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS REGARDING THE PROPOSED
TRANSACTION, LAKE NATIONAL'S SHAREHOLDERS AND INVESTORS ARE URGED TO
READ THE PROXY STATEMENT AND ITS EXHIBITS BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION ABOUT LAKE NATIONAL AND THE PROPOSED TRANSACTION.
Copies of the proxy statement will be mailed to all shareholders prior
to the special meeting. Shareholders and investors may obtain additional
free copies of the proxy statement when it becomes available by
directing a request by telephone or mail to Lake National Bank, 7402
Center Street, Mentor, OH 44060, Attention: Andrew L. Meinhold
(telephone: 440-205-8100).
Lake National Bank and its directors and executive officers may be
deemed to be participants in the solicitation of proxies from the
shareholders of Lake National Bank in connection with the special
meeting of shareholders. Information about the directors and executive
officers of Lake National Bank is set forth in the proxy statement for
Lake National Bank's 2015 annual meeting of shareholders. Additional
information regarding the interests of these participants and other
persons who may be deemed participants in the proxy solicitation may be
obtained by reading the proxy statement for the special meeting of
shareholders when it becomes available.
View source version on businesswire.com: http://www.businesswire.com/news/home/20151230005219/en/
CNB Financial Corp.
Joseph B. Bower, Jr. , 814-765-9621
President
and CEO
or
ERIEBANK
David J. Zimmer III, 814-866-4183
President
or
Lake
National Bank
Andrew L. Meinhold, 440-205-8100
President and
CEO
Source: CNB Financial Corporation