* To pay $10.22/share in all-stock deal
* First Chester shares to get 0.453 Tower shr apiece
* Deal represents 86 pct premium to Thursday's close
* Tower says deal to significantly add to earnings
Dec 28 - Tower Bancorp Inc (TOBC.O) agreed to buy First Chester County Corp (FCEC.O) for about $65 million, or $10.22 per share, in an all-stock deal to expand into southeastern Pennsylvania, the companies said.
Shareholders of West Chester, Pennsylvania-based First Chester will get 0.453 shares of Tower common stock for each First Chester share held.
The deal value represents a premium of about 86 percent to First Chester stock's closing on Thursday on Nasdaq.
As part of the deal, Tower's Graystone Tower Bank unit will raise its lending facility with First Chester to up to $26 million and purchase up to $100 million of residential mortgage and commercial loans from First National Bank of Chester County to meet regulatory requirements.
The deal will provide Tower with an additional $1.3 billion in assets including, $958 million in gross loans held for investment and $986 million in deposits, the companies said in a statement.
The deal, which is expected to close in the second quarter, will add 23 branches situated across four counties in southeastern Pennsylvania and will not result in any branch closure, the companies said.
Tower Bancorp said the acquisition will immediately and significantly add to its earnings per share.
Shares of Tower Bancorp closed at $22.55 Thursday on Nasdaq. (Reporting by Abhinav Sharma in Bangalore; Editing by Gopakumar Warrier)