updated 8/2/2004 11:25:01 AM ET 2004-08-02T15:25:01

Fifth Third Bancorp is buying First National Bankshares of Florida Inc. for almost $1.6 billion in stock, enabling it to expand its presence in Florida.

Fifth Third said Monday it will acquire 77 full-service banking centers located mostly in Orlando, Tampa Bay, Sarasota, Naples and Fort Myers. First National is currently in the process of acquiring two banks, said Fifth Third spokeswoman Roberta Jennings.

First National has about $5.3 billion in total assets including pending acquisitions. Once the deal is complete, Fifth Third will have more than 90 banking centers and more than $6 billion in managed assets in Florida.

Both boards of directors have approved the acquisition, which is expected to close in the first quarter of 2005 pending regulatory approval.

First National shareholders will receive about 0.5065 shares of Fifth Third stock for each of their shares. That represents stock worth about $25 a share on Friday, a 41 percent premium over First National’s closing price on Friday.

The announcement sent First National’s shares soaring $6.30, or 35 percent, to $24.09 a share in Monday morning trading on the New York Stock Exchange. Fifth Third’s shares were down 46 cents to $48.90 on the Nasdaq Stock Market.

The companies said they expect one-time costs, including acquisition-related and restructuring charges, will not exceed $100 million before taxes.

Jennings said it was too early to say if there will be any layoffs but noted that there is little overlap between the two companies.

Fifth Third, based in Cincinnati, has $95.6 billion in assets and operates in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee and West Virginia.

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