Huntington Bancshares to Merge with FirstMerit

Huntington Bancshares and FirstMerit signed a definitive merger agreement under which Ohio-based FirstMerit, the parent company of FirstMerit Bank, will merge into Huntington in a stock and cash transaction.

Based on the closing price of Huntington’s common shares on January 25, 2016 of $8.80, the total transaction value is approximately $3.4 billion, including outstanding options and other equity-linked securities.

The partnership brings together two companies that have served their respective communities for 150 years or more, meeting the banking needs of consumers and small and middle market businesses across the Midwest.

“We are very pleased to come together with FirstMerit to create a regional bank with added customer convenience, an enhanced portfolio of products for consumers and businesses, as well as strong market share,” said Steve Steinour, Huntington chairman, president and CEO. “I believe the strength of this deal is that both organizations already understand the needs and goals of our Midwestern customers and communities. Our combined track records of service excellence and efficient financial management will add value for our collective shareholders, customers, communities and colleagues.”

Huntington recently posted record earnings for 2015, including a 10% increase in net income and a 13% increase in earnings per common share, driven by ongoing growth in revenues, deposits and lending. FirstMerit recently announced its 67th consecutive quarter of profitability, reflecting strong organic loan growth and continued balance sheet strength.

The pro forma company is expected to have nearly $100 billion in assets and will operate across an eight-state Midwestern footprint. The combination will create the largest bank in Ohio, based on deposit market share. Huntington will also expand its operations into the markets of Chicago and Wisconsin.

“Joining forces with Huntington will give us an opportunity to combine both companies’ commercial, small business, wealth and consumer expertise while giving all of our customers greater access to services,” said Paul Greig, FirstMerit chairman, president and CEO. “We will also leverage our strong credit culture and continue our mutual tradition of community involvement to help our Midwest markets grow. We have every confidence that the integration with Huntington will be smooth and seamless for our customers and our communities, and are pleased with the commitments that Huntington has made to our employees and communities.”

Under the terms of the definitive agreement, FirstMerit will merge with a subsidiary of Huntington Bancshares, and FirstMerit Bank will merge with and into The Huntington National Bank. In conjunction with the closing of the transaction, four independent members of the FirstMerit board of directors will join the Huntington Board, which will be expanded accordingly.

Shareholders of FirstMerit Corporation will receive 1.72 shares of Huntington common stock, and $5.00 in cash, for each share of FirstMerit Corporation common stock. The per share consideration is valued at $20.14 per share based on the closing price of Huntington common stock on January 25, 2016.

The transaction is expected to be completed in the Q3/16, subject to the satisfaction of customary closing conditions, including regulatory approvals and the approval of the shareholders of Huntington and FirstMerit Corporation.

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