The Acquisition of LinkBank by Burke & Herbert Financial Services Corp
In an exciting development for the banking industry, Alexandria-based Burke & Herbert Financial Services Corp has announced its acquisition of LinkBancorp, parent company of LinkBank, for a staggering $354.2 million in stock. This strategic move is set to create a powerhouse bank with $11 billion in assets, $9.1 billion in deposits, and $8 billion in loans, solidifying Burke & Herbert’s presence in the Mid-Atlantic region.
Expanding Footprint and Strengthening Market Position
With the addition of LinkBank, Burke & Herbert will gain access to Pennsylvania and a 100-branch footprint across six states. LinkBank brings in 24 branches and four loan production offices, adding to Burke & Herbert’s existing 75 locations. This expansion not only increases the bank’s physical presence but also enhances its market share and customer reach.
David P. Boyle, CEO of Burke & Herbert, expressed his excitement about the merger, stating that it marks a significant milestone for the bank. He emphasized the combined strengths of both institutions, highlighting the value they aim to deliver to customers, employees, communities, and shareholders. The move into Pennsylvania and the expanded presence in key Mid-Atlantic markets underscore Burke & Herbert’s commitment to community banking and its reputation as a trusted financial partner.
Growth through Strategic Acquisitions
This acquisition is only the second for Burke & Herbert, following its successful expansion with the purchase of Summit Financial Group in 2024. The LinkBank deal is a testament to the bank’s dedication to growth and innovation in the financial services sector. LinkBank, too, has been active in recent years, with mergers and acquisitions that have reshaped its operational focus.
As part of the agreement, two Link directors will join Burke & Herbert’s board, with Link CEO Andrew Samuel also joining as a senior adviser. The appointment of key executives from LinkBank to Burke & Herbert’s team further strengthens the integration of both organizations and sets the stage for collaborative success.
Financial Impact and Industry Trends
The deal structure involves Link investors receiving 0.1350 shares of Burke & Herbert stock for each Link share they own. This equates to $9.42 in value per share based on Burke & Herbert’s closing stock price. The transaction is expected to result in a tangible book value dilution of about 10%, with an earn-back period of 3.2 years. Additionally, it is projected to be 18% accretive to earnings per share in 2027.
The banking industry has seen a surge in mergers and acquisitions, driven in part by regulatory easing under the Trump administration. This year alone, approximately 175 bank deals have been announced, representing a 48% increase from the previous year. Notably, six of these deals have been valued at $1 billion or more, signaling a trend of consolidation and growth within the sector.
Overall, the acquisition of LinkBank by Burke & Herbert Financial Services Corp represents a significant move in the banking landscape, with both institutions poised for continued success and expansion in the Mid-Atlantic region.
