WESTERN PENNSYLVANIA F.N.B. to acquire Pittsburgh bank company in $136M deal

By DON SHILLING
VINDICATOR BUSINESS EDITOR
HERMITAGE, Pa. -- F.N.B. Corp. is buying the largest independent community bank in Pittsburgh.
The Hermitage-based company said today that it has signed an agreement to acquire NSD Bancorp in a $135.8 million stock deal.
If the deal is completed, NSD's subsidiary NorthSide Bank would become part of First National Bank of Pennsylvania, which is the banking arm of F.N.B.
Stephen Gurgovits, F.N.B. president and chief executive, said the company's top priority is to grow in the Pittsburgh area. NorthSide's 11 branches are located from Fox Chapel to Cranberry.
"The merger will place F.N.B. Corp. squarely in the midst of the fastest growing and wealthiest communities in greater Pittsburgh," Gurgovits said.
He said NorthSide's branches would be a natural extension for First National's branch network. First National would have 141 branches after the deal.
About the deal
To gain NorthSide's branches, F.N.B. plans to give NSD shareholders 1.8 F.N.B. shares for each NSD share they own.
This is equivalent to a purchase price of $39.01 a share, based on F.N.B. stock's closing price Thursday. NSD's stock closed at $24.15 Thursday, meaning the deal would give NSD shareholders a 62 percent premium.
NSD stock has traded in between $20.60 and $24.90 in the past year.
F.N.B. said it expects the acquisition to add to its earnings next year.
The acquisition must be approved by NSD shareholders and banking regulators. F.N.B. officials expect the deal to close in the first quarter of next year.
Andrew Hasley, NSD president, said NSD shareholders should receive a larger dividend return with F.N.B. He said customers will have access to more banking locations, products and services, such as wealth management, mutual funds, annuities and insurance.
The deal calls for Hasley to be named president and chief executive of First National Bank's new Pittsburgh region. One member of the NSD board of directors is to be added to the F.N.B. board, and three other NSD directors are to join the First National Bank board.
Deposits
NorthSide Bank had deposits of $394 million June 30, an increase of 32 percent over four years. The deposits represent 9.4 percent of the deposit base in its market area.
The bank also had assets of $532 million. The acquisition would increase F.N.B.'s assets to $5.8 billion.
In July, F.N.B. acquired Pittsburgh-based Morrell, Butz and Junker Insurance Agency, which was renamed First National Insurance Agency. Earlier this month, F.N.B. completed the acquisition of the parent company of First National Bank of Slippery Rock, which expanded F.N.B.'s presence into Butler County.
shilling@vindy.com