NEW WINDSOR PURCHASE

12 Months Ended

Dec. 31, 2016

Business Combinations [Abstract]

NEW WINDSOR PURCHASE

NEW WINDSOR PURCHASE

On November 22, 2016, ACNB announced the execution of the Agreement and Plan of Reorganization effective November 21, 2016, whereby New Windsor Bancorp, Inc. (“New Windsor”) will be merged with and into an ACNB acquisition subsidiary and, as soon as possible thereafter, New Windsor State Bank, New Windsor’s wholly-owned subsidiary bank, will merge with and into ACNB Bank. Two directors from New Windsor will join the boards of ACNB and ACNB Bank, respectively, and ACNB Bank will operate in the Maryland market as “NWSB Bank, a division of ACNB Bank”. Based on the financial results as of December 31, 2016, the combined company would have pro forma total assets of $1.51 billion, total deposits of $1.25 billion, and loans of $1.15 billion.

At their election, New Windsor shareholders will receive 1.10 shares of ACNB common stock or $30.00 cash for each share of New Windsor common stock that they own as of the closing date. The transaction is subject to an election and allocation procedure that will result in 85% of the consideration being paid as ACNB common stock and 15% of the consideration being paid in cash. The 15% paid in cash will be paid on the basis of $30.00 per share. Based on the market close on November 21, 2016, the transaction is valued at $33,294,000 or $33.11 per share.

Merger related expenses of $472,000 were incurred in 2016 for the proposed purchase of New Windsor Bancorp, Inc. that is projected to close in either the late second quarter or early third quarter of 2017. The proposed purchase is subject to customary closing conditions, including regulatory and New Windsor stockholder approvals.