WSFS to acquire Beneficial Bancorp

Deal expected to be final in early 2019

WILMINGTON, DEL. » Two area banks with a combined banking history of more than 350 years have announced plans to merge — in a transaction estimated at $1.5 billion.

WSFS Financial Corp. (WSFS) and Beneficial Bancorp Inc. (BENEFICIAL) jointly announced Wednesday that they had signed a definitive agreement to combine. As part of the acquisition, Beneficial Bank, the wholly owned subsidiary of Beneficial, will merge into WSFS Bank, a wholly owned subsidiary of WSFS.

Once completed, the transaction will create the largest locally-headquartered community bank in the Greater Delaware Valley, according to company information.

With $13 billion in assets, the combined bank will fill a longstanding service gap in the Delaware Valley market between larger regional and national banks and smaller community banks, according to WSFS Chairman, President and CEO Mark A. Turner.

“This is an historic combination,” Turner said in a press release. Turner will become WSFS’ Executive Chairman on January 1, 2019. “Together, we are poised and positioned to serve customers, to capture good market share, to expand the reach of our proven successful business model, and to deliver sustainable high performance for years to come.”

Under the terms of the agreement — which has been unanimously approved by the boards of directors of both companies — stockholders of Beneficial will receive 0.3013 shares of WSFS common stock and $2.93 in cash for each share of Beneficial common stock. Based on WSFS’ closing price as of August 7, the per share value equates to $19.61 for Beneficial stockholders, according to the release.

“We strongly believe there is value in partnering with WSFS and combining the strengths of our institutions,” Gerard P. Cuddy, president and CEO of Beneficial said in the release. “This is a sound decision for Beneficial, our stockholders, our employees and the communities we serve.”

“This partnership and our delivery transformation aligns with our strategic plan,” said Rodger Levenson, WSFS’ executive vice president and chief operating officer in the release. Levenson will become president and CEO of WSFS on January 1, 2019. “Our combination with Beneficial creates the ideal opportunity to transform WSFS’ customer delivery and back office systems that will secure our competitive edge in a fast-changing financial services industry.”

Over the next 12 to 24 months, WSFS anticipates consolidating approximately 25 percent of the combined physical banking offices due to geographic overlap and changing customer needs and optimization opportunities within the network, according to the release.

The company then plans to reinvest $32 million, or about 50 percent of the estimated cost savings from the network optimization, into a five-year investment in technology and delivery systems.

WSFS operates 77 offices, including 60 banking offices, predominantly in Delaware and southeastern Pennsylvania. The company has three offices in Chester County, seven offices in Delaware County and six offices in Montgomery County. Beneficial operates 72 offices, including 61 banking offices, predominantly in Philadelphia and neighboring communities in southeastern Pennsylvania and southern New Jersey. The company operates nine offices in Chester County, nine offices in Delaware County and five offices in Montgomery County.

“We are excited to be joining WSFS,” Frank A. Farnesi, Beneficial’s chairman said Wednesday. “It’s a superior financial services company that has consistently delivered outstanding value to its stockholders. The combination of these two banking franchises will create a financial powerhouse uniquely dedicated to the customers and communities of the Delaware Valley.”

The combination is WSFS’ eighth acquisition since 2010. The transaction is expected to close during the first quarter of 2019. Upon completion of the acquisition, Cuddy will become vice chairman of WSFS Bank and will join the boards of directors of WSFS Financial and WSFS Bank along with two mutually agreed upon current directors of Beneficial’s board.

WSFS Bank was founded in Wilmington, Del. in 1832 as Wilmington Savings Fund Society.

For more information about WSFS Financial Corporation visit wsfsbank.com. Beneficial was founded in Philadelphia in 1853 as Beneficial Savings Fund. For more information about Beneficial and Beneficial Bank visit www.thebeneficial.com.

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