Fulton Financial to acquire Philadelphia-based Prudential Bancorp

Lancaster-based Fulton Financial Corp., with offices in Lehigh Valley, has entered into a definitive agreement and plan of merger to acquire Prudential Bancorp Inc., Philadelphia. 

Under the terms of the agreement, Prudential shareholders will receive Fulton common stock based on a fixed exchange ratio of 0.7974 Fulton shares and $3.65 in cash for each Prudential share they own, according to a Fulton Financial statement. 

 The implied value of the transaction, based on the 10-day volume weighted average stock price of $18.01 for Fulton’s common stock for the period ending March 1, 2022, is approximately $142.1 million in the aggregate, or $18.01 per Prudential common share, Fulton said. 

Fulton Financial Corporation, the bank holding company for Fulton Bank, N.A., with consolidated assets of approximately $26 billion, provides financial services through 200 financial centers in Pennsylvania, Delaware, Maryland, New Jersey and Virginia. 

Prudential is the holding company of Prudential Bank, a Pennsylvania-chartered savings bank with assets of approximately $1.1 billion. Prudential conducts business from its headquarters and main office in Philadelphia, as well as seven additional full-service financial centers in Philadelphia, and one each in Drexel Hill, Delaware County and Huntingdon Valley, Montgomery County. 

 The transaction is expected to qualify as a tax-free exchange with respect to the stock consideration received by Prudential shareholders. In aggregate, approximately 80% of the transaction consideration to Prudential common shareholders will consist of Fulton common stock, with the remaining 20% payable in cash. 

The merger transaction has been unanimously approved by the boards of directors of each company, and the announcement of the transaction was made Wednesday by E. Philip Wenger, Fulton’s chairman, president and CEO, and Dennis Pollack, Prudential’s president and CEO.  

“I have shared with investors Fulton’s desire to be more active in mergers and acquisitions of companies that are a good fit for us – strategically, culturally and geographically,” said Wenger.  

The merger is expected to close in the third quarter of 2022, after satisfaction of closing conditions described in the agreement, including the receipt of customary regulatory approvals and the approval by Prudential’s shareholders. Prudential’s bank subsidiary, Prudential Bank, will be merged into Fulton’s bank subsidiary, Fulton Bank, N.A. 

As part of this acquisition, Fulton Financial Corporation will make a $2 million contribution to the Fulton Forward Foundation, designated to be used to provide impact gifts in support of nonprofit community organizations in Philadelphia that are focused on advancing economic empowerment, particularly in underserved communities, Fulton said. 

 “We look forward to working with the Prudential team to bring our mutual community-oriented style of banking, our comprehensive range of products and services, and our talented teams together,” Wenger said.  

“As we do this, we are pleased to increase our financial support, through the Fulton Forward Foundation, of community organizations that are focused on enhancing diversity, equity and inclusion, building vibrant communities, fostering affordable housing, driving economic development and increasing financial literacy in and around Philadelphia,” he said. 

“We are very pleased to join with a partner like Fulton that shares our commitment to community banking, said Pollack. “We both have a history of placing the customer first and working to improve the lives of persons in the communities we serve.” 

Stephens Inc. served as financial advisor to Fulton, and Barley Snyder LLP served as legal counsel to Fulton. Keefe, Bruyette & Woods, Inc. served as financial advisor to Prudential, and Silver, Freedman, Taff & Tiernan LLP served as its legal counsel.