SHIPPENSBURG, Pa. - Orrstown Financial Services, Inc. (NASDAQ: NASDAQ:ORRF), the parent company of Orrstown Bank, and Codorus Valley Bancorp, Inc. (NASDAQ: CVLY), the parent company of PeoplesBank, announced today that they have obtained all necessary regulatory approvals for their planned merger.
The approvals, granted by the Board of Governors of the Federal Reserve System and the Pennsylvania Department of Banking and Securities, mark a significant step toward finalizing the merger, which the companies describe as a "merger of equals."
The transaction is expected to close on July 1, 2024, contingent upon the fulfillment of customary closing conditions. This strategic move is anticipated to combine the resources of Orrstown and Codorus Valley, both of which are established financial services providers in their respective regions.
Orrstown Bank operates in multiple counties across Pennsylvania and Maryland and is known for offering a broad range of consumer and business financial services. Similarly, Codorus Valley, through PeoplesBank, provides a variety of financial services, including wealth management and mortgage services in South Central Pennsylvania and Central Maryland.
The announcement comes with the usual caveats about forward-looking statements, acknowledging the potential for unforeseen factors that could affect the merger's financial results and performance. Both companies have cautioned that the anticipated benefits of the merger, including the timing and completion of integration, may not materialize as expected due to a variety of risks and uncertainties.
The completion of this merger is subject to a number of conditions, including but not limited to, the ability of the companies to integrate successfully and to achieve anticipated revenues and cost savings. The issuance of additional shares by Orrstown as part of the transaction is also noted, which may result in dilution of current shareholder value.
The merger is being closely watched as it represents a consolidation in the regional banking sector, indicative of the competitive nature of the industry and the ongoing trend of strategic partnerships aimed at strengthening market presence.
This news article is based on a press release statement from Orrstown Financial Services, Inc. and Codorus Valley Bancorp, Inc.
InvestingPro Insights
As Orrstown Financial Services, Inc. and Codorus Valley Bancorp, Inc. move forward with their merger, investors and analysts are closely monitoring Codorus Valley's financial metrics and performance indicators. According to InvestingPro data, Codorus Valley Bancorp (NASDAQ: CVLY) currently holds a market capitalization of $208.51 million, with a notable price-to-earnings (P/E) ratio of 9.32.
The adjusted P/E ratio for the last twelve months as of Q1 2024 stands at 9.03, suggesting a stable valuation relative to earnings. Additionally, the company boasts a dividend yield of 3.15%, reflecting an attractive income-generating opportunity for investors, particularly in light of the company's history of maintaining dividend payments for 36 consecutive years.
Two InvestingPro Tips highlight the company's shareholder-friendly reputation: Codorus Valley has raised its dividend for three consecutive years and shows a high shareholder yield. These factors are particularly relevant for investors considering the implications of the merger on future dividend policies and shareholder returns.
InvestingPro offers a comprehensive array of additional tips, including insights on gross profit margins and net income projections. For those seeking a deeper dive into Codorus Valley's financial outlook, InvestingPro features a total of 7 tips, which can be accessed by visiting the dedicated page for CVLY at https://www.investing.com/pro/CVLY. As part of our commitment to providing valuable investment information, we invite you to take advantage of an exclusive offer: use the coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking even more expert analysis and tips.
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