BEACHWOOD, Ohio - Horizon Financial Services Inc. said it is negotiating with Republic Bancorp Inc. of Ann Arbor, Mich., to adjust the terms of their proposed merger.

A spokesman for Republic, which has $626 million in assets, said it proposed a renegotiation after finding that "financial synergies" and cost savings were likely to be less than expected.

Horizon, which owns Horizon Savings Bank in the Cleveland area, has $379 million in assets. Republic has offered two of its shares for each one of Horizon, but the companies said there was "no assurance that a new agreement will be reached."

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