Maine's largest independent bank is taking another bite out of the New Hampshire market.
Portland's People's Heritage Financial Group is buying privately held Bankcore Inc. of North Conway, N.H., for $19.5 million in cash.
Bankcore subsidiary North Conway Bank, with $133 million in assets and six branches, will be merged into People's Heritage subsidiary First National Bank of Portsmouth.
The move beefs up the $2.8 billion-asset holding company's share of the Granite State's market and brings it into the northern part of the state, along the western border of Maine. First National Bank of Portsmouth has $413 million in assets and 10 branches in southeastern New Hampshire.
"We do have an interest in expanding our New Hampshire operations," said People's Heritage spokesman Brian Arsenault.
Mr. Arsenault added that the company is looking for other growth opportunities and may realize them in the wake of the merger between Providence-based Fleet Financial Group and Shawmut National Corp., Boston. As part of that merger, Fleet plans to sell or close about 200 branches and divest $3 billion in deposits.
Mr. Arsenault said the company will not venture into neighboring Massachusetts for further growth, except as part of a purchase in New Hampshire.
Under terms of the Bankcore merger agreement, Bankcore shareholders will receive 75.16 shares of People's Heritage stock and five-year debentures worth $958.30 per share for each of the 10,000 shares of Bankcore stock.
Shareholders may also receive $958.30 in cash per share instead of the debentures, which most are expected to choose, Mr. Arsenault said.
The debentures were set up at the request of Bankcore's two largest shareholders, including chairman and chief executive S. Jean Fernandez. The two shareholders did not want to receive all of the money in one year because of tax issues, Mr. Arsenault said.
The merger with Bankcore includes a separate agreement with Mr. Fernandez, the majority shareholder, in which he promises to vote his shares in favor of the merger.