ROCHESTER, N.Y. and SENECA FALLS, N.Y., Sept. 24,
2024 /PRNewswire/ -- ESL Federal Credit Union,
Generations Bank and its parent company Generations Bancorp NY,
Inc. ("Generations Bancorp" (Nasdaq: "GBNY") and with Generations
Bank, collectively "Generations") announced today that they have
entered into a definitive purchase and assumption agreement whereby
ESL Federal Credit Union will acquire substantially all of the
assets and liabilities (including the deposit account liabilities)
of Generations Bank in an all cash transaction ("the P&A
Transaction"). As consideration for the P&A Transaction, ESL
Federal Credit Union will pay Generations $26.2 million in cash and Generations Bank will
retain its equity at the effective time of the P&A Transaction,
less certain reductions and additions.
The agreement was unanimously approved by the Boards of
Directors of ESL Federal Credit Union and Generations. The P&A
Transaction is expected to close late in the second quarter or in
the third quarter of 2025, subject to receiving all regulatory
approvals, approval by Generations Bancorp's shareholders and other
customary closing conditions. Following the completion of the
P&A Transaction and after all of the respective obligations of
Generations Bancorp and Generations Bank are settled or otherwise
accounted for, Generations Bank will liquidate and Generation
Bancorp will distribute its assets to its shareholders (the
"dissolution"), likely in two separate payments as described
herein. Generations Bancorp's shareholders are currently estimated
to receive an aggregate of between $18.00 and $20.00
in cash in exchange for each share of Generations Bancorp common
stock owned (the "per share consideration"). It is expected that
the per share consideration will be distributed in two payments
with the substantial majority of the total per share consideration
expected to be distributed within six to nine months following the
closing of the P&A Transaction, and the balance of the per
share consideration to be distributed six to nine months after the
first payment.
Currently, Generations Bancorp has 2,241,801 outstanding shares
of common stock. The per share consideration is subject to
significant variation based on various factors including
Generations Bank's equity at closing; the amount of the corporate
taxation including the use of any tax loss carryforwards to be used
by Generations Bancorp; the regulatory treatment and costs
associated with the liquidation accounts of Generations which would
be expected to be paid out to eligible depositors of Generations
Bank; expenses associated with the termination of Generations'
defined benefit plans; the amount of cash held by Generations
Bancorp at the closing; costs related to the dissolution and the
distribution of Generations Bancorp's remaining assets to
shareholders; and Generations Bancorp's future operating results.
Based on these factors, investors should not assume that the
ultimate per share consideration to shareholders will be within the
range set forth above.
Pursuant to the liquidation accounts established by Generations
at the time of its second-step conversion, it is expected that
eligible depositors as of the date of the second-step conversion
who continued to have eligible deposits as of each year end between
the closing of the second-step conversion and through the year end
prior to the closing of the P&A Transaction could have the
right to receive a liquidation account payment.
This transaction allows ESL Federal Credit Union to
significantly grow its presence throughout the Greater Rochester and Finger Lakes region,
bringing personal banking, business banking, mortgage services,
wealth management and its superior customer experience to customers
throughout Seneca, Cayuga, and Orleans Counties, while expanding its
footprint in Ontario County. Upon
completion of the P&A Transaction, ESL is expected to have
total assets of approximately $9.6
billion and will increase its footprint to more than 30
full-service branches throughout the Greater Rochester and Finger Lakes region.
"This deal is a strong fit for ESL and Generations because both
organizations are committed and dedicated to serving their
employees, customers and their communities. We look forward to our
future as a stronger, growing financial institution, and bringing
the superior experiences we are known for to employees and
customers in new communities," said Faheem
Masood, President and Chief Executive Officer of ESL Federal
Credit Union.
"We are very excited about our new partnership with ESL Federal
Credit Union. The synergy created by combining these two companies
coupled with the financial strength of the combined institution
will assure that our customers, our employees and our communities
have expanded financial services and membership benefits going
forward. We also believe it reflects our commitment to enhance the
value to our shareholders," said Angela
Krezmer, President and Chief Executive Officer of
Generations Bank.
In the P&A Transaction, ESL was advised by Performance Trust
Capital Partners, as exclusive financial advisor, and Harter Secrest & Emery LLP and Honigman LLP,
as legal counsel. Generations was advised by Keefe, Bruyette &
Woods, a Stifel Company as exclusive financial advisor, and
Luse Gorman, PC, as legal
counsel.
About ESL Federal Credit Union
With more than 100 years of locally owned history, ESL Federal
Credit Union serves as a full-service financial institution to more
than 429,000 members and 16,800 businesses. Founded in 1920, the
company provides personal banking, business banking, mortgage
services and wealth management services through its locally based
24-branch network; telephone, mobile and online banking; and live
chat center.
The Rochester-based financial
institution employs approximately 950 people in the Greater Rochester area and holds more than
$9.2 billion in assets. Since 1996,
ESL has paid out 29 consecutive Owners' Dividends to its members
totaling more than $290 million.
Since the creation of its Community Impact initiative in 2018, ESL
has reinvested more than $100 million
in grants throughout the community. The company has appeared on
Great Place to Work® lists since 2010. ESL Federal Credit Union is
headquartered at 225 Chestnut Street, in Rochester, and can be found online at
www.esl.org.
About Generations Bank
Generations Bank partners with businesses, municipalities
and residents across the Finger Lakes
Region and Western New York to offer banking and
financial services. Founded in 1870 and headquartered
in Seneca Falls, Generations Bank serves the
community from nine retail locations in Seneca
Falls, Auburn, Union
Springs, Waterloo, Geneva, Phelps, Farmington,
and Medina.
In addition to traditional business and consumer deposit
services, Generations Bank focuses on residential
mortgages, as well as manufactured home, automobile, home equity,
commercial, non-residential real estate and construction loans. For
more information, visit MyGenBank.com
Additional Information About the Transaction and Where to
Find It
In connection with the proposed P&A Transaction, Generations
Bancorp will distribute a proxy statement to its shareholders in
connection with a special meeting of shareholders to be called and
held for the purposes of voting on the approval of the P&A
Transaction and related matters. This communication is not intended
to be, and is not, a substitute for the proxy statement or any
other document that the Company may mail to shareholders in
connection with the proposed P&A Transaction.
BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS REGARDING THE
PROPOSED TRANSACTIONS, GENERATIONS BANCORP'S SHAREHOLDERS ARE URGED
TO READ THE PROXY STATEMENT AND ITS EXHIBITS BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT GENERATIONS AND THE PROPOSED
TRANSACTIONS.
Copies of the proxy statement will be mailed to all shareholders
prior to the special meeting. Generations Bancorp's shareholders
will be able to obtain a free copy of the proxy statement, free of
charge, from Generations at www.mygenbank.com.
Participants in the Solicitation
Generations Bancorp and its directors and executive officers may
be deemed to be participants in the solicitation of proxies from
the shareholders of Generations Bancorp in connection with the
special meeting of shareholders. Information about the directors
and executive officers of Generations Bancorp appears in its proxy
statement dated April 12, 2024, for
Generations Bancorp's 2024 annual meeting of shareholders as filed
with the SEC on Schedule 14A. Additional information regarding the
interests of these participants and other persons who may be deemed
participants in the proxy solicitation may be obtained by reading
the proxy statement for the special meeting of shareholders when it
becomes available.
Forward-Looking Statements
This press release contains statements that may be considered
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933. These forward-looking statements are
intended to be covered by the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, and this statement is
included for purposes of complying with these safe harbor
provisions. Forward-looking statements may be identified by
reference to a future period or periods, or by the use of
forward-looking terminology, such as "anticipate," "believe,"
"could," "estimate," "expect," "may," "should," "will," "would," or
similar terms or the negative of those terms. Readers should not
place undue reliance on such forward-looking statements, which
speak only as of the date made. These forward-looking statements
are based on current plans and expectations, which are subject to a
number of risk factors and uncertainties that could cause future
results to differ materially from historical performance or future
expectations. These differences may be the result of various
factors, including, among others: (1) uncertainties regarding the
estimated range of the per share consideration and uncertainties as
to the timing of one or more payments to shareholders representing
the full per share consideration; (2) failure of the parties to
satisfy the closing conditions in the definitive agreement in a
timely manner or at all; (3) failure of the shareholders of
Generations Bancorp to approve the proposed P&A Transaction or
any of the related transactions; (4) failure to obtain governmental
approvals; (5) changes in estimates with respect to the amount of
cash to be received by Generations Bank and/or to be utilized by
Generations Bank and Generations Bancorp following the completion
of the proposed P&A Transaction, and the resulting amount
available for distribution to Generations Bancorp shareholders,
either in the aggregate or on a per-share basis; (6) disruptions to
the parties' businesses as a result of the announcement and
pendency of the P&A Transaction; (7) changes in general
business, industry or economic conditions or competition; (8)
changes in any applicable law, rule, regulation, policy, guideline
or practice governing or affecting credit unions, financial holding
companies and their subsidiaries or with respect to tax or
accounting principles or otherwise; (9) adverse changes or
conditions in the capital and financial markets; (10) changes in
interest rates or credit availability; (11) the adequacy of credit
loss reserves and changes in loan default and charge-off rates;
(12) increased competition and its effect on pricing, spending,
third-party relationships and revenues; (13) unanticipated
regulatory or judicial proceedings and liabilities and other costs;
(14) changes in the cost of funds, demand for loan products or
demand for financial services; and (15) other economic,
competitive, governmental or technological factors affecting
operations, markets, products, services and prices.
The foregoing list should not be construed as exhaustive, and
ESL Credit Union and Generations undertake no obligation to
subsequently revise any forward-looking statements to reflect
events or circumstances after the date of such statements, or to
reflect the occurrence of anticipated or unanticipated events or
circumstances.
For more information, contact:
ESL Federal Credit
Union
Rich Pulvino
VP/Director, Marketing & Corporate Communications
rpulvino@esl.org
585-336-1009
Generations Bancorp NY, Inc.
Angela Krezmer
President and CEO
315-568-1167
Investorrelations@mygenbank.com
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SOURCE Generations Bancorp NY, Inc.