National City ( NCC), a midwestern regional lender, continues to expand its reach into Florida with its second bank acquisition in the southern state in recent weeks. The Cleveland-based bank said Thursday that is has agreed to pay about $1 billion in cash and stock for Fidelity Bankshares ( FFFL), based in West Palm Beach, Fla. National City will pay $39.50 in cash or 1.0977 common shares for each share of Fidelity. The purchase price is a 9% premium to Fidelity's Wednesday closing price of $36.12. Two weeks ago, National City announced another $1 billion deal to buy Florida Harbor Bancshares ( HARB). The deal with Florida Harbor is an all-stock transaction. "Fidelity is a well-run institution with a sizable branch network situated in an attractive growth market," said National City Chairman and CEO David Daberko. In acquiring Fidelity, National City, which currently has operations in Ohio, Illinois, Indiana, Kentucky, Michigan, Missouri and Pennsylvania, will get a bank with $4.2 billion in assets and 52 branches scattered across Florida's east coast. Florida Harbor has $3.2 billion in assets and 40 branches in the Florida. "Basically
National City is just trying to follow the snowbirds from their market down there,'' says Richard Kelly, an investment banker at Sanders Morris Harris who specializes in midmarket bank transactions. In early trading, shares of National City were down 75 cents, or 2%, to $35.99. Fidelity's shares were up $2.23, or 6%, to $38.35.