WEST SPRINGFIELD, Mass. and ENFIELD, Conn., May 31, 2012 /PRNewswire/ -- United Financial Bancorp, Inc. (Nasdaq: UBNK), the holding company for United Bank, and New England Bancshares, Inc. (Nasdaq: NEBS), the holding company for New England Bank, today announced the execution of a definitive merger agreement pursuant to which United Financial Bancorp will acquire New England Bancshares in a transaction currently valued at approximately $91.0 million, based on United Financial Bancorp's 20 day volume weighted average stock price of $15.89 per share as of May 30, 2012 and excluding shares used to terminate New England Bank's employee stock ownership plan. United Financial Bancorp's acquisition of New England Bancshares will add approximately $726.5 million in total assets, $557.9 million in gross loans and $581.6 million in total deposits before acquisition accounting adjustments. The transaction will expand United Financial Bancorp's presence into Hartford, Tolland, New Haven and Litchfield Counties in Connecticut, where New England Bank operates fifteen full-service banking offices and two administrative offices.
Under the terms of the definitive merger agreement, at the effective time of the merger, each share of New England Bancshares common stock will be converted into the right to receive 0.9575 of a share of United Financial Bancorp common stock. The consideration received by New England Bancshares stockholders is intended to qualify as a tax-free transaction. United Financial Bancorp expects the transaction to be immediately accretive to its earnings per share, excluding one-time transaction expenses. The transaction represents 163% of New England Bancshares' tangible book value and a core deposit premium of 7.4% at March 31, 2012.
Richard B. Collins, Chairman of the Board, President and Chief Executive Officer of United Financial Bancorp, stated "We are very pleased to announce our plans to partner with New England Bancshares. This combination presents a tremendous opportunity to expand our presence in Connecticut, where United Bank does not currently maintain any branches. Connecticut is an attractive and growing banking market and one we have had our eye on for some time. Like us, New England Bancshares has deep roots in the communities it serves, and we look forward to introducing our brand of banking to this region. We believe the strategic value of this transaction will enhance our franchise and add value to our stockholders' investment. We are excited about the future of our combined company."
"We feel that this merger is an excellent opportunity for our customers and the communities we serve," said David J. O'Connor, President and Chief Executive Officer of New England Bancshares. "Partnering with United Bank will allow us to continue providing our customers with a high level of personalized service and local decision-making while preserving our community bank atmosphere."The transaction, which has been approved by the board of directors of both New England Bancshares and United Financial Bancorp, is expected to close in the fourth quarter of 2012. The transaction is subject to certain conditions, including the approval by United Financial Bancorp's and New England Bancshares' stockholders and customary regulatory approvals.