Ohio’s Waterford Bancorp has agreed to acquire Michigan’s Clarkston Financial in a deal worth around $34.8m.

At the end of March 2019, Waterford and Clarkston managed assets of $748m and $219m, respectively.

Under the agreement, Clarkston will merge with and into Waterford.

At the same time, Clarkston subsidiary Clarkston State Bank will merge with and into Waterford subsidiary Waterford Bank.

As per the agreed terms of the transaction, each Clarkston share can be swapped for 0.1196 shares of Waterford common stock or $10.52 per share in cash.

Clarkston president and CEO Grant Smith said: “Waterford’s business model emphasising the delivery of exceptional service and value fits perfectly with our approach to community banking.”

The deal already secured the green light from the two companies’ boards. It is now pending and shareholder and regulatory approvals.

As part of the deal, two Clarkston directors will gain seats on the Waterford board.

Waterford chairman and CEO Mike Miller said: “This is a unique opportunity consistent with our Strategic Plan to expand to larger, metro markets.

“Clarkston State Bank operates with a very similar business model and culture, and we expect to make significant investments to pursue future growth.

“Clarkston and Waterford share a strong focus and commitment to community development and customers, further signifying they are the right partner for us.”