United Community Financial Corp. of Youngstown, Ohio, said recently that it is buying Butler Wick Corp., a local full-service investment firm.
The acquisition is valued at roughly $20.8 million on the basis of United Community's closing price of $12.25 per share Friday, when the deal was announced. United Community would issue 1.7 million shares for all shares of Butler Wick in a tax-free stock swap. The thrift company trades on the Nasdaq.
The deal would be accounted for as a pooling of interests and is expected to close in the third quarter. Butler Wick would become a subsidiary of United Community.
The company, which has $1.3 billion of assets, is the parent of Home Savings and Loan Co., also based in Youngstown. It does not offer investment products, said Patrick A. Kelly, the chief financial officer.
Butler Wick offers brokerage, asset management, and trust services.
Mr. Kelly said that buying Butler Wick is preferable to hiring a third- party provider.
Butler Wick is "in some markets where we're not, and we're in some markets where they're not," he said.
Mr. Kelly said the purchase should also increase United Community's fee- based income and help cushion it against interest rate fluctuations.