ORRF - Orrstown Financial Services Inc. and Codorus Valley Bancorp Inc. Announce a Merger of Equals to Create a Premier Pennsylvania and Maryland Community Banking Franchise | Benzinga
SHIPPENSBURG, Pa. and YORK, Pa., Dec. 12, 2023 (GLOBE NEWSWIRE) -- Orrstown Financial Services, Inc. ("Orrstown") (NASDAQ:ORRF), the parent company of Orrstown Bank, and Codorus Valley Bancorp, Inc. ("Codorus Valley") (NASDAQ:CVLY), the parent company of PeoplesBank, A Codorus Valley Company ("PeoplesBank"), today announced they have entered into a definitive agreement pursuant to which Codorus Valley will merge with and into Orrstown in an all-stock transaction valued at approximately $207.0 million, or $21.31 per share of Codorus Valley common stock, based on the $24.35 closing price of Orrstown common stock on December 11, 2023.
Transaction Highlights:
- Merger of Equals transaction creating a premier Pennsylvania and Maryland community bank with approximately $5.2 billion in assets and a market capitalization of approximately $460 million
- The combined company will have 51 branches serving attractive markets throughout a contiguous footprint in Central and Eastern Pennsylvania and the Greater Baltimore, Maryland area
- Closely aligned corporate cultures and operating philosophies with a continued focus on, and presence in, our combined communities
- Deep commitment to the community banking business model
- Administrative headquarters located in Harrisburg, PA
- Operations center located in York, PA
- Charitable foundations will continue to maintain positive impact on the communities served by each bank for over 100 years
- Strong pro forma profitability and enhanced trading liquidity create significant value for shareholders
- Closing expected to occur in the third quarter of 2024
Thomas R. Quinn, Jr., Orrstown's President and Chief Executive Officer, commented "Orrstown and Codorus Valley share a similar culture, vision and deep commitment to our communities. The partnership of our companies will significantly increase our size and scale, which we believe will not only drive profitability and shareholder value but also benefit our clients, employees and communities through broader product offerings, higher lending limits, an improved customer experience, and increased career opportunities. I am excited by the opportunity to work with Craig and his impressive team to build the premier community banking franchise in our Pennsylvania and Maryland markets."
Craig L. Kauffman, President and Chief Executive Officer of Codorus Valley, commented "This union marks a significant milestone in our commitment to providing enhanced financial services to our valued clients. Together, we are poised to create a stronger, more resilient institution that will harness the synergies of our combined expertise and resources. This merger is a testament to our dedication to innovation, client satisfaction, community engagement and long-term growth in the dynamic landscape of the financial industry. I am excited at the opportunity to work with Tom and his team as we merge our organizations, both of which share similar cultures and dedication to our vision, mission and core values."
Transaction Details
Under the terms of the definitive agreement, which was unanimously approved by the Boards of Directors of both companies, each outstanding share of Codorus Valley common stock will be exchanged for the right to receive 0.875 shares of Orrstown common stock. As a result of the transaction, Orrstown shareholders will own approximately 56% of the outstanding shares of the combined company and Codorus Valley shareholders will own approximately 44% of the outstanding shares of the combined company.
Name, Branding, Headquarters and Markets
The combined company will trade on the Nasdaq Global Select Market under the Orrstown ticker symbol "ORRF". The combined company will operate under the "Orrstown Financial Services, Inc." name, and the combined bank will operate under the "Orrstown Bank" name.
The administrative headquarters of the combined company will be located in Harrisburg, PA while the operations center will be located in York, PA.
The combined company will serve an attractive, contiguous footprint throughout Central and Eastern Pennsylvania and the Greater Baltimore, Maryland region and will remain committed to serving the communities that each bank has served for over a century.
Governance and Leadership
The combined company's Board of Directors will consist of seven directors from Orrstown and six directors from Codorus Valley. Joel R. Zullinger, Chairman of Orrstown's Board of Directors, will serve as Chairman of the Board of the combined company and the combined bank. J. Rodney Messick, Chairman of Codorus Valley's Board of Directors, will serve as Vice-Chairman of the Board of the combined company and the combined bank.
Thomas R. Quinn, Jr., the current President and Chief Executive Officer of Orrstown, will serve as President and Chief Executive Officer of the combined company and the combined bank at closing.
Craig L. Kauffman, the current President and Chief Executive Officer of Codorus Valley, will serve as Executive Vice President and Chief Operating Officer of the combined company and the combined bank at closing.
Mr. Kauffman will be appointed President and Chief Executive Officer of the combined company and combined bank on or about June 1, 2025 upon Mr. Quinn's retirement.
Neil Kalani, the current ...