Community Financial acquires County First Bank
The Community Financial Corporation (NASDAQ: TCFC), the holding company for Community Bank of the Chesapeake, and County First Bank (OTCQB: CUMD) jointly announced on July 31 that they have signed a definitive agreement pursuant to which County First Bank, headquartered in La Plata, will be merged with and into Community Bank of the Chesapeake, according to a press release.
Under the terms of the merger agreement, which was unanimously approved by the boards of directors of each company, upon completion of the merger, County First Bank shareholders will be entitled to receive 0.9543 shares of The Community Financial Corporation common stock and $1 in cash for each share of County First Bank common stock they hold. County First shareholders may also receive, in the aggregate, additional contingent cash consideration of up to $2,154,303 (representing a maximum potential per-share value of $2.24) based upon the resolution of certain identified assets prior to closing. There can be no assurance that County First will sell, resolve or otherwise dispose of any of the identified assets or that County First shareholders will receive any contingent cash consideration, according to the release.
Based on the closing price of the Community Financial Corp. common stock on July 28, the value of the transaction is approximately $34.3 million, excluding any potential contingent cash consideration, according to the release.
“We have admired County First for quite some time and are excited to now be able to partner with them,” stated William J. Pasenelli, CEO of Community Bank of the Chesapeake, in the release. “Our organizations share many common attributes, including an intense focus on the employee and customer experience. The transaction will further strengthen Community Bank of the Chesapeake’s position as the number one deposit holder in the tri-county area. We are looking forward to working with the County First team to make this new partnership a success for our employees, customers, shareholders and communities.”
“We are very pleased to be joining such a robust and well-run organization,” said Doug Mitchell, president and CEO of County First Bank, in the release. “The combined entity will help us better serve our customers.”
Founded in 1990, County First has deposits of $209 million and loans of $156 million, as of June 30. County First operates two branches in Charles County, two branches in St. Mary’s County and one branch in Calvert County. When the transaction is consummated, Community Bank of the Chesapeake will have approximately $1.6 billion in assets, according to the release.
The transaction is expected to close in the fourth quarter of 2017 or early in the first quarter of 2018, and is subject to customary closing conditions, including approval by bank regulatory authorities and County First shareholders. Until the transaction closing date, each institution will continue serving customers and daily operations as usual, according to the release.
Keefe, Bruyette & Woods Inc. and RP Financial LC acted as financial advisors to the Community Financial Corp. Kilpatrick, Townsend & Stockton LLP served as legal counsel to the Community Financial Corp. Boenning & Scattergood Inc. acted as financial advisor to County First Bank. Hunton & Williams LLP served as legal counsel to County First Bank.