Southern Indiana Business Report
EVANSVILLE – Evansville-based Old National Bank is on the grow. Old National Bancorp and First Midwest Bancorp Inc. jointly announced June 1 they have entered into a definitive merger agreement to combine in an all-stock merger of equals transaction with a total market value of $6.5 billion. The expanded firm will have $45 billion in combined assets.
The new organization will operate under the Old National Bancorp and Old National Bank names, with dual headquarters in Evansville and Chicago, Illinois.
Under the terms of the merger agreement, which has been unanimously approved by the boards of directors of both companies, First Midwest stockholders will receive 1.1336 shares of Old National common stock for each share of First Midwest common stock they own. Following completion of the transaction, former First Midwest stockholders are expected to collectively represent approximately 44% of the combined company. Michael Scudder, chairman and CEO of First Midwest Bancorp, will serve as the executive chairman, and Jim Ryan, chairman and CEO of Old National Bancorp, will maintain his role as CEO.
Additional leadership positions for the combined entity include:
- Mark Sander, president and chief operating officer (First Midwest)
- Jim Sandgren, CEO of commercial banking (Old National)
- Brendon Falconer, chief financial officer (Old National)
- Kendra Vanzo, chief administrative officer (Old National)
- Kevin Geoghegan, chief credit officer (First Midwest)
- Thomas Prame, CEO of community banking (First Midwest)
- Chady AlAhmar, CEO of wealth management (Old National)
The complete executive leadership team is expected to be announced prior to close.
The transaction is anticipated to close in late 2021 or early 2022, subject to customary closing conditions, including regulatory and shareholder approvals.
The board of directors of the combined company will have 16 directors, consisting of eight directors from Old National and eight directors from First Midwest. Becky Skillman, lead independent director for Old National, will retain this position in the combined company.
“First Midwest and Old National are two relationship-focused financial institutions that have rich histories, extremely compatible cultures and a shared commitment to helping our clients achieve financial success,” said Scudder. “As a combined organization, we will be in an even stronger position to invest, grow and innovate in talent, capabilities and services that will enhance an already superior client experience and further set us apart as a market leader not only in Chicago but across the Midwest.”
“First Midwest’s leadership team and colleagues not only mirror the Old National mission, values and culture, they also offer exceptional consumer and commercial banking services,” said Ryan. “We are confident that the powerful synergies, additional market coverage and financial strength this partnership creates will drive long-term shareholder value, and we are excited about combining the outstanding legacies of two strong, client- and community-focused organizations.”
The combined organization will create the sixth-largest bank headquartered in the Midwest, with a presence in six of the largest Midwestern MSAs.
Old National Bancorp is already the largest bank holding company headquartered in Indiana. With $23.7 billion in assets, it ranks among the top 100 banking companies in the U.S. It was founded in Evansville in 1834. In the region, Old National operates branches in Bedford, Loogootee, Washington, Jasper, Huntingburg, Ferdinand and Paoli.
First Midwest is one of the largest independent publicly traded bank holding companies based on assets headquartered in Chicago, Illinois, and the Midwest, with approximately $21 billion of assets and an additional $14 billion of assets under management. The primary footprint of First Midwest’s branch network and other locations is in metropolitan Chicago, Illinois, southeast Wisconsin, northwest Indiana, central and western Illinois, and eastern Iowa.
Due to the lack of service overlap, disruption is expected to be limited.