Merger with MutualFirst

Northwest Bancshares, Inc., the holding company for Northwest Bank, announced April 24 that it has successfully completed its merger with MutualFirst Financial, Inc., the holding company for MutualBank.

Ronald J. Seiffert, chairman, president and chief executive officer of Northwest Bancshares, Inc., said, “We are pleased to announce the completion of our merger with MutualFirst Financial, Inc. and MutualBank. The management teams and employees of both Northwest and MutualFirst Financial have worked tirelessly over the past six months to prepare for the integration of our two companies. We believe that this transaction will help deliver value through increased operating scale and new market opportunities. The combined strength of our institutions will allow us to better serve customers across all of our markets with a wide range of financial products and services, while maintaining the personal service they expect from their community bank.”

Under the terms of the merger agreement, each share of common stock of MutualFirst Financial, Inc. will be converted into the right to receive 2.4 shares of Northwest Bancshares, Inc. common stock. Cash will be paid in lieu of fractional shares at a rate of $10.71 per whole share of Northwest Bancshares, Inc. common stock.

Northwest issued 20,659,087 shares of common stock in the merger (subject to adjustment for cash issued in lieu of fractional shares), and based upon the $10.33 per share closing price of Northwest’s common stock on April 24, the transaction value was approximately $213.4 million. The completion of the merger has resulted in a bank with approximately $12.8 billion in total assets, providing banking services through 214 branch locations and 273 ATMs in four states. The transaction has expanded Northwest’s franchise by 36 full service offices located in Indiana.

B. Riley FBR, Inc. served as financial advisor and Luse Gorman, PC served as legal counsel to Northwest Bancshares, Inc. in this transaction.

Keefe, Bruyette & Woods, A Stifel Company, served as financial advisor and Silver, Freedman, Taff & Tiernan LLP served as legal counsel to MutualFirst Financial, Inc.

First quarter earnings, dividend

Northwest Bancshares, Inc. announced net income for the quarter ended March 31 of $7.9 million, or $0.07 per diluted share. This represents a decrease of $17.1 million, or 68.3%, compared to the same quarter last year when net income was $25.0 million or $0.24 per diluted share. The annualized returns on average shareholders’ equity and average assets for the quarter ended March 31 were 2.37% and 0.30% compared to 7.96% and 1.03% for the same quarter last year.

The company also announced that its board of directors declared a quarterly cash dividend of $0.19 per share payable on May 15 to shareholders of record as of May 7. This is the 102nd consecutive quarter in which the company has paid a cash dividend. Based on the market value of the company’s stock as of March 31, this represents an annualized dividend yield of approximately 6.57%.

In making this announcement, Ronald J. Seiffert, chairman, president and CEO, said, “It goes without saying that we are operating in unprecedented times that were impossible to predict just two months ago. Similar to all individuals and businesses, we are trying to react to the daily challenges driven by the pandemic, the government mandates and the recommendations of healthcare professionals while balancing the needs and expectations of our families, employees, customers, communities and shareholders. To that end, we have taken every measure and precaution to protect our employees while continuing to service our customers. At the same time, we are being very mindful of the fiduciary responsibility that we have to our shareholders.”