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United Bankshares to acquire Centra Financial Holdings

Deal subject to approval by Centra's stockholders, regulatory approvals and other closing conditions

December 16, 2010|By JULIE E. GREENE | julieg@herald-mail.com

HAGERSTOWN — United Bankshares Inc. plans to acquire Centra Financial Holdings Inc., which operates Centra Banks in the Hagerstown and Martinsburg, W.Va., areas, the banks announced Thursday in a joint statement.

The parent company of United Bank is buying Centra Financial Holdings in a deal valued at $186.9 million, according to the statement.

Officials with the two banks have signed a definitive merger agreement that will expand United's business in Maryland and West Virginia, as well as allow United to enter the Pennsylvania market, according to the statement filed with the U.S. Exchange and Securities Commission.

The deal is subject to approval by Centra's stockholders, regulatory approvals and other closing conditions.

Local Centra customers will not notice any difference, said Richard Phoebus, a member of Centra's local board of directors.

"From all that we know of United Bank, (it's) a very similar operation to ours, and we expect the same high quality of service people are used to at Centra," Phoebus said.

Asked whether any banks would close or whether there would be layoffs, the chief financial officer for United Bankshares and a Centra chief financial officer declined comment.

Phoebus said there is currently no overlap in Washington County between the two banks.

Phoebus said he did not know what the name of the local branches would be after the merger.

A telephone message left for Tim Henry, chief executive officer for Centra Bank's Hagerstown operation, resulted in a faxed copy of the merger news release with the statement that no further comments or information were currently available.

The acquisition is expected to be finalized in the third quarter of 2011, which begins in July, according to SEC filings.

Centra, with headquarters in Morgantown, W.Va., has $1.4 billion in assets, 15 offices and one loan origination office, according to the announcement. Centra's banks are in the areas of Hagerstown, Martinsburg, Morgantown and Uniontown, Pa.

With the acquisition of Centra, United's assets will increase to about $9 billion, according to the statement on the SEC's website at www.sec.gov.

Shares of United Bankshares opened at $26.94 Thursday and got as high as $27.55 before closing at $26.87, a loss of 7 cents.

Centra does not trade on the stock exchange, but is an SEC registrant, said Darren Williams, Centra's senior vice president and chief financial officer.

Centra had 2,041 stockholders as of Nov. 1, according to its website at www.centrabank.com.

Through the deal, United will acquire all of Centra's outstanding shares in exchange for United common shares. The exchange ratio will be 0.7676 of United shares for each share of Centra, which is $21 based on United's closing price of $27.36 on Dec. 10, according to the news release.

United will provide cash considerations for Centra's outstanding options.

United has $7.6 billion in assets and 112 offices in Ohio, West Virginia, Virginia, Maryland, and Washington, D.C. United has dual headquarters in Washington, D.C., and Charleston, W.Va.

According to SEC filings, the merger's termination provisions note that if the agreement is terminated under specified circumstances, Centra must pay United a $7.5 million termination fee.

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