Community Bank says deal to acquire Oneida Financial needs more time

DeWITT, N.Y. — Community Bank System Inc. (NYSE: CBU) says it expects “additional time will be required” to obtain the “necessary” regulatory approvals to complete its proposed acquisition of Oneida Financial Corp. (NASDAQ: ONFC).

Community Bank says it will extend the anticipated timeframe for closing the transaction “beyond early July,” the original target, according to a news release, the DeWitt–based banking company issued late Wednesday afternoon.

Now, Community Bank expects the acquisition to close sometime during the third or fourth quarter — “as soon as possible” after all the “necessary” regulatory approvals, as well as the OK of Oneida Financial stockholders and “satisfaction of all closing conditions, the release stated.

It was late February, when Community Bank System first announced plans to acquire Oneida Financial, 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.

Oneida Financial will still hold its stockholders meeting next Wednesday, June 17, as scheduled, so they can vote on the proposed acquisition.

However, Community Bank is extending the ongoing election process allowing Oneida Financial shareholders to “elect the form of their merger consideration.” The extension follows the change in the anticipated closing date, according to the news release.

The acquisition closing timeframe was not the only matter Community Bank System addressed in its Wednesday news release.

Community Bank, Oneida Financial, and other defendants have settled three class-action lawsuits. The release did not elaborate on the details of those suits, but said Oneida Financial’s anticipated total out-of-pocket costs, including legal fees, to settle the cases should not surpass $100,000.

Community Bank System, with assets of about $7.6 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.

Oneida Financial, headquartered in Oneida, had total assets of nearly $882 million as of March 31, deposits of $771.5 million, and 12 banking offices across Madison and Oneida counties.

Contact Reinhardt at ereinhardt@cnybj.com