People’s United Financial Inc., the holding company for People’s United Bank, is acquiring United Financial Bancorp Inc., the holding company for United Bank, in a 100% stock transaction valued at approximately $759 million.
“We are excited to welcome United Bank to People”™s United,” said Jack Barnes, chairman and CEO of Bridgeport-based People”™s United Financial. “With the fourth-largest deposit market share in the combined Hartford and Springfield market, a complementary array of commercial and retail capabilities and a shared legacy of community giving, United will solidify our presence in the central Connecticut market and strengthen our franchise in western Massachusetts.”
People”™s United Bank maintains about 400 retail locations in Connecticut, New York, Massachusetts, Vermont, New Hampshire and Maine, as well as wealth management and insurance solutions, with more than $48 billion in assets.
Established in 1858 and headquartered in Hartford, United Bank is a full-service community financial services firm with $7.3 billion in assets. The bank has nearly 60 branches concentrated in Connecticut, Massachusetts and Rhode Island, and employs some 700 people.
People”™s United has acknowledged that some jobs will likely be cut at United Bank, though precise figures were not made available. According to sources, about 60% of United Bank branches are within two miles of People”™s United branches, and nearly 90% are within five miles.
People’s United expects the transaction to be 7 cents accretive to earnings per common share based on fully phased-in cost savings, with a tangible book value earn-back of approximately 2.3 years and an internal rate of return of approximately 18%.
The transaction is expected to close during the fourth quarter, subject to regulatory approvals as well as the approval of United Financial Bancorp Inc. shareholders.
Keefe, Bruyette & Woods Inc. served as financial adviser, and Simpson Thacher & Bartlett LLP served as legal counsel, to People’s United. Sandler O”™Neill & Partners served as financial adviser, and Sullivan & Cromwell LLP as legal counsel, to United Financial.
