Berkshire Hills Bancorp and Brookline Bancorp have signed a merger agreement, in the latest consolidation activity among US regional lenders.
The all-stock transaction is valued at around $1.1bn, or $12.68 per Brookline common stock share.
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Under the merger terms, unanimously approved by both companies’ boards of directors, Brookline shareholders will receive 0.42 shares of Berkshire stock for each Brookline share.
The combined business will have $24bn in assets and 148 branch offices.
Berkshire Hills president and CEO Nitin Mhatre said: “Today marks a transformational milestone in the history of two storied institutions with a strong commitment to serving their clients and communities.
“The combined organisation will be in an even stronger position to deliver exceptional client experience and create greater value for shareholders.”
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By GlobalDataPost-transaction, Berkshire shareholders will own about 51% of the merged group, while Brookline shareholders will own around 45%. The remaining 4% stake in the merged company will be held by investors from equity raise.
Legally, Berkshire will acquire Brookline, but Brookline will be the accounting acquiror, marking Berkshire’s assets and liabilities to market at closing.
The transaction will consolidate the existing four bank charters into one Massachusetts state-chartered bank, operating under Brookline Bank’s charter.
Brookline Bancorp chairman and CEO Paul Perrault said: “This transaction presents an opportunity to bring together two historic franchises in the Northeast market.
“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 new entity’s executive headquarters will be in Boston, Massachusetts, US with operational centres across the Northeast.
Its board of directors will comprise eight directors each from Berkshire and Brookline.
The new banking structure will divide into six regions, each led by a local leader, three from Berkshire and three from Brookline.
This deal is anticipated to complete by the end of the second half of 2025, contingent on regulatory and shareholder approvals.
It follows the $562m merger agreement signed between Independent Bank, the parent company of Rockland Trust, and Enterprise Bancorp, a parent company of Enterprise Bank.
