(Reuters) – Regional lender Old National Bancorp said on Monday it will buy privately held Bremer Financial in a $1.40 billion cash-and-stock deal, creating a combined bank with over $70 billion in assets.
Bremer shareholders will receive 4.182 shares of Old National and $26.22 in cash, valuing the lender at $116.76 per share.
Dealmaking between regional lenders has surged this year as they seek scale to better compete against bigger rivals, and is expected to get a further boost from President-elect Donald Trump’s lenient stance on capital rules and merger approvals.
The Bremer deal will bolster Old National’s footprint in Minnesota, North Dakota and Wisconsin.
Founded in 1943, Minnesota-based Bremer has $16.2 billion in assets, while Indiana-based Old National has about $54 billion.
Bremer is majority owned by the Otto Bremer Trust, which will own about 11% of Old National upon the deal close.
Citi and Squire Patton Boggs were the advisers to Old National. J.P. Morgan and Wachtell, Lipton, Rosen & Katz advised Bremer.
Keefe, Bruyette & Woods and Sullivan & Cromwell advised Otto Bremer Trust.
Separately, Old National sold 19 million shares in a stock offering at $21 each for $400 million.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Krishna Chandra Eluri and Shinjini Ganguli)
