Citizens Bancorp, the holding company for Citizens Bank & Trust Co. of Maryland, announced yesterday that it has entered into agreements with several stockholders of Peoples Security Bank of Maryland to buy their shares of common stock for cash at $45 each.
The transactions, which would give Citizens Bancorp control of 54 percent of Peoples Security's common stock, would be worth more than $12 million.
Citizens Bancorp said its agreements with the group of unidentified stockholders represent the first phase of its plan to acquire all of Peoples' common stock, for which it will pay the same cash price of $45 a share. A tender offer for the remaining shares will be made promptly to all other Peoples stockholders, Citizens Bancorp Chairman Alfred H. Smith said.
The agreements also call for an eventual merger of Peoples into Citizens Bank & Trust Co. The purchase is subject to regulatory approvals and other conditions, which were not disclosed.
A merger with Peoples Security, which is based in Landover, would give Citizens Bank the largest branch network in its primary market area of Prince George's and Montgomery counties. Citizens operates 71 offices in Maryland, and Peoples Security has 21 branches.
Citizens' acquisition and merger of Peoples Security into its subsidiary would be the fifth since 1977 for the Riverdale-based institution. Citizens' most recent merger was completed in December when it acquired Kennedy Bank & Trust of Bethesda. Other mergers in recent years have included Bank of Brandywine, Century National Bank and Chevy Chase Bank & Trust Co.
A merger with Peoples Security would enable Citizens to expand its service area without too much difficulty, because there is very little overlap of the two branch systems, an official said.
Citizens Bancorp reported deposits in excess of $715 million and assets totaling $839 million on March 31. Its acquisition of Peoples Security would give Citizens Bancorp assets of more than $1 billion.