The $343 million merger of Susquehanna Bank and Graystone Tower Bank is scheduled to be completed on Feb. 17 and will come with some branch consolidations.
Shareholders of Susquehanna Bancshares and Tower Bancorp, in separate votes on Wednesday, approved a merger agreement under which Susquehanna will acquire all outstanding shares of common stock of Tower.
It is the second new owner for the former West Chester-based First Chester County Corp. in a year.
Tower, based in Harrisburg, bought the parent company of First National Bank of Chester County in December 2010 for $49.5 million.
The former First National branches now operate under the 1N banner. That name will be changed to Susquehanna Bank after the deal closes early next year, said Stephen Trapnell, corporate communications manager at Susquehanna.
After the acquisition is complete, several 1N Bank branches in Chester County, along with one Susquehanna branch, will close because they are located close to another branch, Trapnell explained.
Letters to customers are being mailed out explaining the transition, Trapnell said.
Slated to close are all the satellite 1N branches in retirement communities, which include Crosslands, Freedom Village, Kendal at Longwood in Chester County and Granite Farm Estates and Lima Estates in Delaware County. Accounts will be picked up by a nearby full-service branch, Trapnell said.
The 1N Longwood branch will be closed and accounts moved to the Kennett branch on West Cypress Street.
The 1N branch in the Giant supermarket at 700 Nutt Road in Phoenixville will close. Accounts will move to the Susquehanna branch at 119 Nutt Road in Phoenixville.
In West Chester, the Susquehanna branch at 15 East Gay St. and the 1N branch on Matlack Street will both close. Business will be picked by the 1N branch on North High Street.
Once combined, Trapnell said Susquehanna will operate 15 branches in Chester County.
Trapnell said there has been no determination made on layoffs yet. Those decisions will be made when Susquehanna looks at staffing needs after the consolidations.
Under the terms of the latest deal, Tower shareholders will have the option of receiving either 3.46 shares of Susquehanna common stock or $28 in cash for each share of Tower common stock.
The combined company will have approximately $17.8 billion in assets and nearly 260 locations in Pennsylvania, Maryland, New Jersey and West Virginia.
Susquehanna Bancshares, a financial services holding company with assets of approximately $15 billion, is headquartered in Lititz.
"Our shareholders recognize the strategic significance of combining Susquehanna and Tower," said William J. Reuter, Susquehanna's chairman and CEO.
Tower Bancorp is the parent company of Graystone Tower Bank, with 49 branch offices in central and southeastern Pennsylvania and Maryland. It has assets of $2.5 billion.
"We look forward to joining the Susquehanna team," said Andrew Samuel, chairman and CEO of Tower.