- People’s United Financial rose 14% on Monday after M&T Bank agreed to take over the regional bank for $ 7.6 billion.
- The proposed merger will be stock funded, with M&T issuing 0.118 shares for each share in People’s United.
- The combined bank will have $ 200 billion in assets and will have locations in 12 states on the east coast.
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People’s United Financial rose as much as 14% on Monday after M&T Bank agreed to acquire the regional bank worth $ 7.6 billion.
M&T will fund the entire deal in stock, issuing 0.118 shares for each People’s United share. The transaction represents a premium of 13% on the closing price of People’s United Financial on Friday.
The combined regional bank will have offices in 12 states across the Northeast and Mid-Atlantic, with approximately $ 200 billion in assets.
Upon completion of the merger, People’s United shareholders will collectively own 28% of the merged company.
“The combination of our shared heritage and complementary footprints will strengthen our ability to serve our communities and customers and provide solutions that change people’s lives,” said René Jones, CEO of M&T.
M&T anticipates the combination will immediately increase to its tangible book value per share and 10-12% to its earnings per share in 2023. The combined bank expects to realize annual cost synergies of $ 330 million.
The proposed merger has been approved by the boards of both companies and is expected to be completed in the fourth quarter of 2021.
M & T’s shares rose 2% in Monday trading.