National City to buy Provident Financial Group

CLEVELAND (AP) -- National City Corp. announced Tuesday it plans to buy Provident Financial Group Inc. of Cincinnati and its Provident Bank in a tax-free stock swap valued at $2.1 billion.
Under the deal, shareholders of Provident Financial Group will get 1.135 shares of National City common stock for each share of Provident common stock they hold.
Based on the companies' Friday closing prices, the transaction places a 15 percent premium on Provident stock. National City ended the week at $35.39, while Provident closed at $34.83. The market was closed Monday for the Presidents' Day holiday.
In Tuesday trading, National City's shares were basically unchanged to close at $34.56 on the New York Stock Exchange. Provident's stock rose $3.87, or 11 percent, to close at $38.70 on the Nasdaq Stock Market.
It marks the second big acquisition announced in three months for National City, which landed a foothold in the St. Louis market with an agreement in November to acquire Allegiant Bancorp Inc. for about $475 million. That deal could be completed by next month.