Old National Bancorp to buy permanent Bancorp, Inc. for 2.30 times revenue

Weekly Corporate Growth Report, Jan 10, 2000

The Deal: In an attempt to expand in Indiana, Old National Bancorp has agreed to acquire Permanent Bancorp, Inc. for $82.4 million in stock. Permanent Bancorp shareholders will receive Old bancorp shares worth $20.59 for each of their shares. After the news of the acquisition was announced, shares of Permanent Bancorp rose $3.4375 each, to $18.1875.

Discussion: Permanent Bancorp is the holding company for Permanent Federal Savings Bank. Started in 1885, the bank offers CDs and savings, commercial and individual checking, NOW, and money market accounts. Lending activities consist of originating and purchasing loans, including oneto four-family residential mortgages, which makes up 70% of the portfolio, consumer, which makes up nearly 20%, multifamily and commercial real estate, construction, and business loans. Some residential loans are sold on the secondary market. The bank also invests in mortgage-backed securities. Additionally, Permanent Bancorp's subsidiaries offer insurance and brokerage services.

Old National Bancorp is a multibank holding company with about 120 banking facilities in Indiana, Kentucky, and Illinois. The banking subsidiaries offer such services as checking and savings accounts, including NOW and money market accounts, as well as commercial, consumer, and real estate loans; and money management. The firm also reinsures credit life, accident, and health insurance; offers fiduciary and trust services; performs consumer financing; and sells property, auto, casualty, life, and disability insurance.