DeWITT, N.Y. — Community Bank System, Inc. (NYSE: CBU) announced Tuesday it has agreed to acquire Oneida Financial Corp. (NASDAQ: ONFC), parent of Oneida Savings Bank, for about $142 million in a mix of stock and cash.
Under the deal’s terms, shareholders of Oneida Financial can choose to receive either 0.5635 shares of Community Bank System common stock, or $20 in cash for each share of Oneida Financial stock they hold, subject to an overall 60 percent stock and 40 percent cash split. The board of directors of both companies has unanimously approved the merger agreement, Community Bank said in a news release.
The purchase price represents a 51 percent premium to Oneida Financial’s closing stock price of $13.25 on Tuesday.
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Oneida Financial shares soared $6.20, or 46 percent, to $19.45 in Wednesday trading, as of 1:45 p.m. Community Bank shares fell 50 cents, or 1.4 percent, to $35.07.
Community Bank, based in DeWitt, said it would become the fourth largest bank in the Syracuse metro area, ranked by market share, following the acquisition. The deal is expected to close in July, subject to approval by Oneida Financial shareholders and bank regulators.
Community Bank said Oneida Financial’s significant insurance, benefits administration, and wealth-management businesses will “meaningfully strengthen and complement” its existing non-banking businesses.
The agreement provides for Michael Kallet, chairman and CEO, and Eric Stickels, president and COO, from Oneida Financial to join the board of directors of Community Bank System.
RBC Capital Markets, LLC acted as exclusive financial advisor to Community Bank System, and Bond Schoeneck & King, PLLC acted as its legal advisor. Keefe, Bruyette & Woods, a Stifel Company, acted as exclusive financial advisor to Oneida Financial and rendered a fairness opinion, and Luse Gorman, P.C. acted as its legal advisor, according to the news release.
Oneida Financial, headquartered in Oneida, has total assets of nearly $800 million, deposits of $690 million, and 12 banking offices across Madison and Oneida Counties.
Community Bank System, with assets of about $7.5 billion, operates more than 190 branches across upstate New York and Northeastern Pennsylvania through its banking subsidiary, Community Bank, N.A. That includes 51 branches in the 16-county Central New York area, including seven in the Syracuse metro area, according to FDIC data.
Contact Rombel at arombel@cnybj.com