NEW YORK ( TheStreet) -- The banking industry is coming out of its summer doldrums and the consolidation of regional players is likely to accelerate.
There are bargains out there for acquisitive regional banks, and with an increased regulatory burden there are plenty of reasons for some banks to throw in the towel -- providing they get a decent price. In addition, stronger players continue to ponder government-assisted acquisitions of failed banks.
First Niagara Financial (FNFG) of Buffalo, N.Y. agreed to purchase NewAlliance Bancshares (NAL) of New Haven, Conn. for either $14.09 in cash or 1.10 First Niagara shares for each NewAlliance share, . This represented a 24% premium based on NewAlliance's Wednesday closing price of $11.36.
New Alliance's CEO Peyton Patterson also pointed out that NewAlliance's shareholders who accept First Niagara shares would "more than double the dividends earned."Following the trend for other recent bank merger deals, at least two law firms were "investigating" the transactions, as some NewAlliance shareholders were looking for a better price. The deal marked the third recent major expansion First Niagara into neighboring markets, following the acquisition of Harleysville National of Harleysville, Penn. which was acquired on April 9 and the purchase of 57 National City Bank branches in western Pennsylvania in September 2009..