BY Fraser Tennant
In another sign of increasing consolidation within the US banking industry, regional lenders Berkshire Hills Bancorp and Brookline Bancorp are to merge in an all-stock transaction valued at approximately $1.1bn.
Under the terms of the definitive agreement, Berkshire shareholders will own approximately 51 percent of the combined company, Brookline shareholders will own approximately 45 percent, and investors in new shares will own approximately 4 percent of the outstanding shares.
The merger will see the creation of a $24bn franchise that uniquely positions the combined company to benefit from significant economies of scale and capitalise on meaningful growth opportunities through business diversification and improved competitive positioning.
The combined bank will be divided into six regions. Each of those regions will be led by an experienced local leader who will be responsible for the overall business performance in their markets.
This model allows the combined company to achieve the efficiencies of operating one bank while maintaining a regional banking structure that enables local market leaders to make autonomous decisions with the support and balance sheet of a larger institution.
“This merger marks a transformational milestone in the history of two storied institutions with a strong commitment to serving their clients and communities,” said Nitin J. Mhatre, president and chief executive of Berkshire. “The combined organisation will be in an even stronger position to deliver exceptional client experience and create greater value for shareholders.”
The transaction has been unanimously approved by the boards of directors of both companies.
“This transaction presents an opportunity to bring together two historic franchises in the Northeast market,” said Paul A. Perrault, chairman and chief executive of Brookline. “By bringing together two complementary cultures and geographic footprints with shared values and client focus, we will be better positioned to serve our customers, employees, communities and shareholders."
The transaction is expected to close by the end of the second half of 2025, subject to satisfaction of customary closing conditions, including receipt of required regulatory approvals and approvals from Berkshire and Brookline shareholders.
David Brunelle, chairperson of Berkshire, concluded: “This highly compelling combination is a true merger of equals that will create a preeminent northeast financial institution.”
News: Regional lenders Berkshire Hills Bancorp, Brookline strike $1.1 bln merger deal