MANISTIQUE — The directors of Mackinac Financial Corporation, the holding company for mBank, announced the consummation of the all-stock merger of First Federal of Northern Michigan Bancorp, Inc., Alpena, with and into Mackinac. First Federal of Northern Michigan (First Federal), FFNM’s subsidiary bank, was consolidated into mBank and all branches opened as mBank locations on Monday, May 21. Consistent with the terms of the agreement and plan of merger, FFNM shareholders will receive .576 shares of Mackinac common stock for each share of FFNM common stock. The aggregate value of the stock consideration, based on an assumed value of Mackinac shares of $15.67, which is the average closing price for the previous five trading days, is approximately $33.6 million. FFNM also maintained the required minimum equity necessary to declare and pay an $8 million special dividend to its shareholders immediately prior to closing as part of the agreement.

The special dividend is expected to be released for distribution on May 25, 2018. Total consideration to FFNM shareholders in connection with the transaction would equate to $41.6 million, based upon the assumed value of Mackinac common shares.

The transaction will increase Mackinac’s post-transaction assets to an estimated $1.3 billion and balance sheet loans to approximately $1 billion. mBank plans to consolidate First Federal’s Gaylord office into mBank’s Gaylord location on June 18.