River Forest Village President Frank Paris had lots of reasons to smile last week. First Oak Brook Bank, which Paris serves as vice chairman of its board of directors, announced its intention on May 2 to merge with MB Financial. First Oak Brook currently has $2.3 billion in assets, $1.9 billion in deposits and 21 branches, nearly all in DuPage County.

Paris said Monday that the merger, if approved by shareholders and federal regulators, would make the new MB Financial “the premier middle market lender in the area,” with over $8.2 billion in assets and 61 Chicago area locations. That would rank MB Financial behind only banking giants Chase and Harris in DuPage County.

“I’m very pleased about it,” said Paris, who called the deal an exceptionally good one for both First Oak Brook and MB Financial.

And well he should be pleased. Paris, who confirmed Monday that he is one of the top three shareholders in the bank, purchased 15,000 additional shares on May 1, the day before the merger was announced, as part of a stock option.

“It was better to exercise now than to pay the (capital gains) tax,” he said.

The merger agreement entitles each shareholder of First Oak Brook common stock to choose MB Financial common stock, cash or a combination of both, subject to limitations and prorations. Receipt of shares of MB Financial stock in the merger is expected to be tax-free.

MB Financial’s buyout offer is expected to be 30 times the bank’s estimated 2006 earnings, well above the normal 20 times earnings for bank sales. Bank officials involved in the deal estimate that the deal values each share of First Oak Brook stock at $36.80, “with a transaction value of approximately $372 million, exclusive of stock options.”

There had been press speculation recently that First Oak Brook was being wooed by several mid-sized banks. Paris confirmed that the bank had, in fact, entertained “several” unsolicited offers recently, but wouldn’t go into details. According to Crain’s, the merger talk caused trading in First Oak Brook stock to spike, with 10 times the daily average trading taking place four days before the merger announcement, according to documents filed with the Security and Exchange Commission.

Paris, 67, served as the president and chairman of the board of Oak Brook Bank from 1970 to 1983, when it became First Oak Brook. He has served as the director of Oak Brook Bancshares, First Oak Brook’s holding company, since its organization in 1983. He said he hasn’t decided yet whether he’ll stay on with the new bank in any capacity, and may ultimately choose to retire.

“I haven’t decided yet,” he said.

In any event, he’ll have some time to make that decision. While he said he’s confident of shareholder and regulatory approval, Paris noted that process will take until sometime in September at the earliest.

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