When merger deals die, the prospective acquiree often strikes a deal with someone else before too long.

But Security First Corp., Mayfield Heights, Ohio - which a year ago saw its agreement to be acquired by Mid Am Inc., Bowling Green, Ohio, fall apart - has since assumed the role of acquirer on its own.

"Our philosophy is right now, as long as we can continue to perform well, there's no real need to put ourselves up for sale," said Austin J. Mulhern, president and chief operating officer of Security First, which reported Sept. 30 return on equity of 15.09% and return on assets of 1.31%.

In the last year, the $450 million-asset company has opened two new branches in Broadville Heights and Strongsville, Ohio, and struck a $21.5 million deal to acquire First Kent Financial Corp., expected to close early next year.

Mr. Mulhern said the company decided to go back to its pre-deal strategy after the Mid Am deal fell apart and it had seen no interest from other potential acquirers.

"We weren't really a target before," Mr. Mulhern said. "We didn't put ourselves up for sale and have an investment banker. It was a situation where we thought there was chemistry and we thought it could work."

One possible deterrent to a new deal is that under the termination agreement, any company acquiring Security for more than $14.79 a share before June 30, 1996, must pay Mid Am $2 million.

Meanwhile, Security First said in October it would exchange 1.70 of its shares for each share of $80 million-asset First Kent. It believes it can expand niches such as construction lending into the new market.

However, analyst Ross A. Demmerle of McDonald & Co. Securities Inc., Cleveland, said Security First "paid way too much" for First Kent - 156% of book value, or 21 times earnings. Thrift prices this year have averaged 17 times earnings, he said.

Mr. Demmerle has lowered his fiscal 1997 earnings-per-share estimate for Security First to $1.45 from $1.60.

However, Mr. Mulhern said he thinks Security First can beat analyst estimates.

"We're aware of the ... situation that the market does not like a lot of dilution," Mr. Mulhern said. "Our challenge is to do better than the analysts said we would do."

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