The merger between Camden National Corporation (NASDAQ: CAC), the bank holding company for Camden National Bank based in Maine, and Northway Financial (OTCQB: NWYF), the parent company of Northway Bank in based in North Conway, is exepcted to be compelted ion the first quarter of 2025. The banks entered into a definitive agreement this past fall under which Camden National will acquire Northway in an all-stock transaction valued at approximately $86.6 million.
The combined company will have 74 branches serving attractive markets throughout a contiguous footprint in NH and Maine, with approximately $7 billion in assets, $5.1 billion in loans, $5.5 billion in deposits, and $2.0 billion of Assets Under Administration (AUA). The combined company will operate under the Camden National Bank name.
“Camden National and Northway share a similar culture, consistent credit and risk profiles, and deep commitment to the communities we serve,” says Simon Griffiths, president and CEO of Camden National. “This union will increase our size and scale, and bolster our presence in New Hampshire, which we believe will drive profitability and shareholder value. Our customers, employees, and communities will significantly benefit from broader product offerings, higher lending limits, and an enhanced customer experience.”
“We are excited to announce this strategic combination with Camden National. The ability to have two organizations with similar missions come together positions us well in a significantly competitive market; particularly with an improved ability to allocate capital in more ways than we could on our own. Combined, we strengthen our foundations of a forward-thinking approach to community banking while best serving clients with whom we have built strong relationships over the years.” says William Woodward, president, CEO and chairman of Northway Financial.
Subject to the terms of the definitive agreement, which both boards have unanimously approved, Northway shareholders will receive 0.83 shares of Camden National common stock for each outstanding share of Northway common stock. Based on Camden National’s closing stock price of $37.90 on September 9, 2024, the transaction is valued at approximately $86.6 million or $31.46 per share of Northway common stock. Following the completion of the transaction, one Northway director will join the boards of directors of both Camden National and Camden National Bank upon the completion of the transaction.
As of June 30, 2024, Northway had approximately $1.3 billion of total assets, $0.9 billion of total loans, and $1.0 billion of deposits.
On a combined basis, the merger is expected to be approximately 19.9% accretive to Camden National’s 2025 earnings per share and 32.7% accretive to Camden National’s 2026 earnings per share. Following the completion of the merger, Camden National’s capital ratios are expected to remain significantly above “well-capitalized” thresholds, with the pro forma company well-positioned for future growth.
The merger is expected to be completed during the first quarter of 2025, subject to certain customary conditions, including the receipt of required regulatory approvals and approval by Northway shareholders.
Upon completion of the transaction, Camden National shareholders will own approximately 86% of the combined company and Northway’s shareholders will own approximately 14% of the combined company, which will continue to trade on Nasdaq under the “CAC” stock ticker symbol.
Current Issue - January 2025