- People’s United Financial surged 10% on Monday after M&T Bank agreed to acquire the regional bank for $7.6 billion.
- The proposed merger will be funded with stock, with M&T issuing 0.118 shares for each People’s United share.
- The combined bank will have $200 billion in assets, with locations in 12 states on the East coast.
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M&T will fund the entire deal with stock, issuing 0.118 shares for each People’s United share. The deal represents a 13% premium to Friday’s closing price of People’s United Financial.
The combined regional bank will have locations in 12 states throughout the Northeast and Mid-Atlantic and have approximately $200 billion in assets.
Upon the completion of the merger, People’s United shareholders will collectively own 28% of the combined company.
“Combining our common legacies and our complementary footprints will strengthen our ability to serve our communities and customers, and provide solutions that make a difference in people’s lives,” M&T CEO René Jones said.
M&T expects the merger to be immediately accretive to its tangible book value per share, and 10%-12% accretive to its earnings per share in 2023. The combined bank expects to realize $330 million in annual cost synergies.
The proposed merger has been approved by the board of directors of both companies and is expected to close in the fourth quarter of 2021.
Shares of M&T traded flat in early Monday trades.