Evansville-based Old National Bancorp said Wednesday that it has agreed to acquire Monroe Bancorp in Bloomington for about $83.5 million.
Old National said the acquisition will strengthen its branch network in the state.
Monroe Bancorp’s subsidiary, Monroe Bank, is the largest bank headquartered in Bloomington. With nearly $850 million in assets, it has 15 branches in central and south central Indiana, including locations in Noblesville and Avon.
Old National, the largest financial services holding company headquartered in Indiana, has $7.7 billion in assets and 165 branches, including about 60 in the Indianapolis area.
Monroe shareholders will get 1.275 shares of Old National stock for every share held, valuing the stock at $13.35 per share. Based on Tuesday’s closing price of $5.38 each, the exchange represents a premium of 148 percent for Monroe stock.
The exchange ratio will be adjusted if Old National’s share price exceeds $10.98 at the time of closing. If that occurs, Monroe shareholders will get $14 of Old National stock for each share held, Old National said in a news release.
The transaction is expected to close by the end of the year or early in the first quarter of 2011, Old National said.
Old National shares dropped 38 cents and were trading at $10.10 late Wednesday morning. The price of Monroe shares, by contrast, more than doubled in morning trading, reaching $11.09 each.