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FAIR LAWN, NJ and FREEHOLD, NJ, June 17, 2021 (GLOBE NEWSWIRE) — Columbia Bank, MHC, Columbia Financial, Inc. (NASDAQ: CLBK) and Columbia Bank (collectively “Columbia”) and Freehold MHC, Freehold Bancorp and Freehold Bank (collectively “Freehold”) announced today that they have entered into a definitive merger agreement.
Under the terms of the merger agreement, Columbia will acquire Freehold, with Freehold MHC and Freehold Bancorp merging with Columbia Bank, MHC and Columbia Financial, respectively. Upon the effective date of these mergers, Freehold Bank will be converted into a federal savings bank and will operate as a wholly owned subsidiary of Columbia Financial. As a subsidiary of Columbia Financial, current depositors of Freehold Bank become members of Columbia Bank, MHC, the parent company of Columbia Bank, a mutual holding company, and have the same rights and privileges as if their accounts had been established in Columbia Bank at Freehold specified date. As part of the transaction, Columbia Financial will issue additional shares of its common stock to Columbia Bank, MHC in an amount equal to Freehold’s fair value as determined by an independent appraiser. These shares are expected to be issued immediately prior to the completion of the mergers. Additionally, upon completion of the mergers, Columbia and the Columbia Bank Foundation will support the charities serving the communities currently served by Freehold.
Freehold Bank is Monmouth County’s oldest savings institution, providing financial services to its local community for more than 167 years and operating from its headquarters and branch office, both located in Freehold, New Jersey. As of March 31, 2021, Freehold Bank had total assets of $299.8 million, loans of $155.9 million, deposits of $197.2 million and equity of $39.5 million.
Columbia has offered all Freehold employees full employment with Freehold Bank and will add a current member of Freehold’s board to the Columbia Bank board upon completion of Freehold Bank’s merger with Columbia Bank, which is expected to occur in two years’ time Completion of mergers of holding companies.
Mr. Thomas J. Kemly, Columbia’s President and Chief Executive Officer, commented, “We are pleased to have the opportunity to welcome Freehold Bank and its employees and clients to Columbia Bank. The transaction will expand our presence in Monmouth County. As two community-focused banks, we pride ourselves on increasing our local impact and supporting new markets.”
Mr. James H. Wainwright, Freehold’s President and Chief Executive Officer, commented, “We are excited to be joining forces with Columbia Bank, a leading New Jersey-based bank with a shared culture and values. The merger offers our clients the opportunity to join a larger banking network with enhanced products and services, while employees benefit from the opportunity to work for a fast-growing community bank. The support of the Columbia Bank Foundation will benefit our local community and charitable organizations.” The transaction, which has been approved by the boards of directors of both companies, is subject to the satisfaction of customary closing conditions, including receipt of various regulatory approvals, and is expected to close in the fourth quarter of 2021 , after all these conditions are met.
On a pro forma basis, the transaction is expected to add to Columbia’s net income in 2022 but slightly dilute 2022 earnings per share by approximately 2% as a result of the additional shares sold to Columbia Bank, MHC were issued. The transaction is expected to add approximately 3% to the fully converted tangible book value.
Columbia was advised on this transaction by investment bank Boenning & Scattergood, Inc. and represented by law firm Kilpatrick Townsend & Stockton LLP. Freehold was advised by FinPro Capital Advisors, Inc. and represented by the law firm of Stevens & Lee, PC.
About Columbia Financial, Inc.
Columbia Financial, Inc. is a Delaware corporation organized as a middle class public company of Columbia Bank. Columbia Financial, Inc. is a majority-owned subsidiary of Columbia Bank, MHC. Columbia Bank is a state-chartered savings bank headquartered in Fair Lawn, New Jersey. The Bank offers traditional financial services to consumers and businesses in our market areas. As of March 31, 2021, Columbia had $9.0 billion in total assets, $6.2 billion in loans and operated 61 stores with $7.0 billion in deposits.
About Freehold Bank
Freehold Bank is a chartered savings bank incorporated and officially incorporated on September 12, 1853. In 2009, Freehold Bank was reorganized into a mutual holding company organizational form and in conjunction Freehold MHC and Freehold Bancorp were formed and Freehold Bank became a wholly owned subsidiary of Freehold Bancorp Freehold Bank’s head office and a branch office are located in Freehold, New Jersey.
Certain statements herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements can be replaced by words such as “believes”, “will”, “would”, “expects”, “projects”, “may”, “could”, “developments”, “strategic”, “initiate, “opportunities”, “anticipate” , “estimate”, “intend”, “plan”, “goals” and similar expressions. These statements are based on the current beliefs and expectations of Columbia management and are subject to significant risks and uncertainties.
Actual results could differ materially from those projected in the forward-looking statements due to a number of factors. The following factors, among others, could cause actual results to differ materially from the anticipated results expressed in the forward-looking statements: (i) Columbia’s and Freehold’s businesses may not be successfully combined, or such a combination may be successful take longer than expected; (ii) the cost savings from the merger may not be fully realized or may take longer than expected to be realized; (iii) post-merger operating expenses, customer losses and business disruption may be greater than anticipated; (iv) regulatory approvals for the merger may not be obtained or adverse regulatory conditions may be imposed in connection with regulatory approvals of the merger or otherwise; (v) the interest rate environment may further depress margins and negatively impact net interest income; (vi) the risks associated with continued asset diversification and adverse changes in credit quality; (vii) changes in laws, regulations and policies; and (viii) the impact of the COVID-19 pandemic, including on our credit quality and operations, and its impact on general economic and financial market conditions. Additional factors that could cause actual results to differ materially from those projected in the forward-looking statements are discussed in Columbia’s reports (such as the annual report on Form 10-K, the quarterly reports on Form 10-Q and the current reports on Form 8) discussed -K) filed with the Securities and Exchange Commission (the “SEC”) and available at the SEC’s Internet website (www.sec.gov). All subsequent written and oral forward-looking statements relating to the Proposed Transaction or other matters attributable to Columbia and Freehold or anyone acting on their behalf are expressly qualified in their entirety by the cautionary statements set forth above. Except as required by law, Columbia and Freehold undertake no obligation to update any forward-looking statement to reflect circumstances or events after the date of the forward-looking statement.
Columbia Financial, Inc. contact information:
Columbia Financial, Inc. Investor Relations Department (833) 550-0717
Freehold Bank contact information:
James H. Wainwright, President and CEO (732) 462-6700
Source: Columbia Financial, Inc.