Banking: USA's People's United to take over Danvers
People's United Financial, Inc. the holding company for People's United Bank, and Danvers Bancorp, Inc. (Nasdaq: DNBK), of Danvers, Massachusetts, the holding company for Danversbank have announced a definitive agreement under which People's United Financial will acquire Danvers Bancorp in a 55% stock and 45% cash transaction valued at approximately USD493 million.
People's United expects the transaction to be immediately accretive to operating earnings with an IRR greater than 15%. The transaction is expected to close late in the second quarter of 2011.
"We are pleased that Danversbank has chosen to grow with People's United Bank," said Jack Barnes, President and Chief Executive Officer of People's United Financial. "Danversbank, combined with our existing Massachusetts presence, makes People's United – New England's largest independent bank – the seventh largest bank both in Massachusetts and in the Boston MSA. Danversbank is a high-quality commercial institution that offers an excellent platform for growth and is a natural extension of our brand. It complements our continuous footprint from Worcester, in central Massachusetts, through Boston and on into New Hampshire."
"I'm confident that this transaction will benefit Danvers Bancorp shareholders, customers and employees," said Kevin T. Bottomley, Chairman, President and Chief Executive Officer of Danvers Bancorp. "People's United brings substantial resources for increased lending, additional products and services and opportunities for professional development for our employees. When coupled with our highly experienced lending staff and extensive eastern Massachusetts branch network, the combined organization will be well positioned to compete with the biggest players in the Greater Boston area."
Bottomley will join the People's United Board of Directors upon the closing of the transaction. In addition, he will be a strategic advisor to People's United in its efforts to successfully integrate the Danversbank organization and grow People's United in the Greater Boston market.
Both boards have approved the deal which is subject to regulatory approval.
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