Ohio’s Huntington Bancshares has agreed to acquire local rival FirstMerit, the parent of FirstMerit Bank, in a stock-cash deal valued at about $3.4bn.
Under the terms of the deal, FirstMerit will merge with a unit of Huntington Bancshares, while FirstMerit Bank will merge with and into The Huntington National Bank.
The merger would lead to the creation of the largest bank in Ohio based on deposit market share, Huntington said in a statement.
The pro-forma company will operate across eight Midwestern states, managing about $100bn in assets. Huntington would also expand footprint in new markets of Chicago and Wisconsin.
Following the completion of the deal, four independent members of the FirstMerit board of directors will join the Huntington board.
The transaction, subject to regulatory and shareholder approvals, is slated to be close in the third quarter of 2016.
Huntington chairman, president and CEO Steve Steinour said: "We are very pleased to come together with FirstMerit to create a regional bank with added customer convenience, an enhanced portfolio of products for consumers and businesses, as well as strong market share. I believe the strength of this deal is that both organizations already understand the needs and goals of our Midwestern customers and communities. Our combined track records of service excellence and efficient financial management will add value for our collective shareholders, customers, communities, and colleagues."