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Dive Brief:
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Columbus, Ohio-based Northwest Bancshares will acquire Williamsport, Pennsylvania-based Penns Woods Bancorp in a deal worth roughly $270.4 million, the companies said Tuesday.
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The transaction, set to close in the third quarter of 2025, would bolster Northwest’s Pennsylvania footprint with 24 added locations and create a bank with more than $17 billion in assets.
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Penns Woods CEO Richard Grafmyre will be appointed to the boards of both Northwest Bank and its holding company once the transaction closes.
Dive Insight:
Acquiring Penns Woods, the holding company for Jersey Shore State Bank and Luzerne Bank, will give Northwest an added $2.3 billion in assets, $1.7 billion in deposits and $1.9 billion in loans.
Louis Torchio, Northwest’s CEO, called the deal “another milestone” in the bank’s “long-term growth strategy.”
“Jersey Shore State Bank and Luzerne Bank have outstanding reputations throughout their respective markets, and we look forward to welcoming our new colleagues and their customers to the Northwest family,” Torchio said. “We will be strongly positioned to continue to serve communities that are familiar to Northwest, expand our presence into new markets, and deliver exceptional banking services across our entire footprint.”
Grafmyre, for his part, touted the “increased scale” the deal would bring, along with “additional capabilities for our customers.”
“We believe that the combination of our highly compatible organizations will create a catalyst for growth and benefit all of the communities we serve,” Grafmyre said.
Once the transaction closes, Penns Woods shareholders will be entitled to 2.385 shares of Northwest common stock for each Penns Woods share they own. That equates to $34.44 per Penns Woods share, based on Northwest’s $14.44 closing stock price from Monday, or 39% above tangible book value.
As part of the deal, Penns Woods shareholders would also be expected to receive a dividend of roughly 48 cents per share – a 50% increase on the quarterly dividend they now receive. Once the transaction closes, shares issued to Penns Woods holders are expected to comprise 12% of the combined company’s outstanding shares.
Northwest, meanwhile, expects the transaction will be 23% accretive to 2026 earnings per share. The Ohio lender estimated it would earn back tangible book value dilution of 9% within three years.