First Fidelity Bancorp. said it will buy First People's National Bank, a closely held community banking company in northeastern Pennsylvania, for $19.6 million in cash.
The New Jersey-based company said it also is buying BankVest Inc., a privately held company that owns 70% of First Peoples.
The two-branch bank, which is located in Edwardsville, has $102 million in assets and $84 million in deposits.
Under terms of the agreement, BankVest's stockholders will receive $214 a share, or $13.8 million in total.
2.17 Times Book
Holders of the remaining 30% of First Peoples will receive $465 for each common share, or a total of $5.8 million.
The purchase price represents 2.17 times BankVest's book value, a First Fidelity spokesman said.
Upon completion of the deal, the bank will be merged into First Fidelity Bank Pennsylvania, which operates 187 branches in eastern Pennsylvania.
First Fidelity, New Jersey's biggest bank, has total assets of $32.2 billion. Its Pennsylvania unit controls $9.9 billion of assets and $7.6 billion of deposits.
The company has been an aggressive acquirer in the past two years, expanding rapidly in New York. New Jersey, and, most recently, Connecticut.
In Pennsylvania, it has expanded primarily in the Philadelphia area. First Fidelity acquired the Pitcairn Private Bank in suburban Jenkintown in April. In 1991, it bought Atlantic Financial Corp., which has 29 branches in and around Philadelphia.