Princeton Bancorp, Inc. entered into an agreement to acquire Cornerstone Financial Corporation from group of shareholders for $17.9 million.
January 17, 2024
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Princeton Bancorp, Inc. (NasdaqGS:BPRN) entered into an agreement to acquire Cornerstone Financial Corporation (OTCPK:CFIC) from group of shareholders for $17.9 million on January 18, 2024. As part of consideration, each share of Cornerstone common stock outstanding will be exchanged for 0.24 shares of Princeton Bancorp. Each share of Cornerstone?s preferred stock outstanding will be exchanged for its stated value of $1,000 per share. CFIC preferred equity of $3.3 million will be repaid at transaction closing. Princeton Bancorp will acquire Cornerstone in a transaction valued at approximately $17.9 million. Under the terms of the merger agreement, Cornerstone will merge with, into and under the charter of Princeton Bancorp. As of the effective time of the merger, one member of the board of directors of Cornerstone, to be selected by the Nominating/Governance Committee of Princeton Bancorp, will be appointed to the board of directors of Princeton Bancorp.
The transaction has been approved by the boards of directors of both companies. The transaction is subject to receipt of all required banking regulatory approvals, Cornerstone stockholder approval and certain financial and other contingencies. The transaction is expected to close in the second or third quarter of 2024. The transaction is also expected to be 21% accretive to Princeton Bancorp?s 2025 earnings per share on a GAAP basis and 16% accretive on a cash basis. As of April 12, 2024, Cornerstone will be required to pay to Princeton a termination fee equal to $849,000.
Bob Hutchinson, Andrew Stager, Calvin ChauDeal from Raymond James & Associates, Inc. acted as financial advisor and Edward C. Hogan of Stevens & Lee, P.C. acted as legal counsel to Princeton Bancorp. Janney Montgomery Scott acted as financial advisor to Cornerstone and rendered a fairness opinion. Robert A. Schwartz of Windels Marx Lane & Mittendorf, LLP acted as legal counsel to Cornerstone.
Cornerstone Financial Corporation is a holding company for Cornerstone Bank (the Bank). The Bank is a state-chartered bank, which offers a variety of traditional commercial banking products and services to small and medium-sized businesses, local professionals and individuals, throughout Burlington, Camden and Gloucester counties in New Jersey. The Bank offers personal banking and business banking services. The personal banking services include checking, savings, CD/IRA, residential mortgage, debit card, mobile banking and online banking. The business banking services include checking, savings, CD'S, business lending, debit card, mobile banking, online banking, remote deposit and cash management services. Its commercial loans include short and long-term loans and commercial lines of credit for the purposes of providing working capital, supporting accounts receivable, purchasing inventory and acquiring fixed assets. Its consumer loans include installment loans and home equity loans.