Aug. 27, 2012
/PRNewswire/ -- Hudson City Bancorp, Inc. (NASDAQ: HCBK) ("
City") and M&T Bank Corporation (NYSE: MTB) ("M&T") announced today that they have entered into a definitive agreement under which
City will merge into a subsidiary of M&T, expanding the premier community banking franchise in the eastern United States.
Under terms of the agreement, each
City share will receive consideration valued at 0.08403 of an M&T share in the form of either M&T stock or cash, based upon the election of each
City shareholder, subject to proration as specified in the merger agreement (which provides for an aggregate split of total consideration of 60% common stock of M&T and 40% cash). Based on the closing price of M&T stock on
August 24, 2012
, the transaction is valued at approximately
. The transaction is expected to be immediately accretive to the combined company's capital ratios, capital generation and tangible book value per share, as well as its GAAP and operating earnings per share.
"This merger creates tremendous opportunities to build on the successes that each company has achieved individually in its own markets," said Hudson City Chairman and CEO,
Ronald E. Hermance, Jr.
City recently embarked on a diversification of our product lines and our balance sheet. This transaction accelerates that transformation. As we combine
City's attractive retail network with M&T's full service commercial banking suite, our stakeholders will participate in the growth of one of the nation's strongest and most successful banking franchises."
"M&T, which was established in 1856, and
City, founded in 1868, have been serving their customers and communities for generations, and we look forward to building on that long history and tradition together in the future," said
Robert G. Wilmers
, M&T Chairman and CEO.
M&T will acquire
City's network of 135 branch offices, which are located in
(97 branches), downstate
(29 branches) and
Fairfield County, Connecticut
(9 branches). M&T's existing branch network is adjacent to
City's franchise, with very little overlap. The combined network of 870 branches will stretch from
M&T expects to gain approximately
in deposits and
in loans from the merger (before acquisition accounting adjustments), giving M&T the fourth largest deposit share in New Jersey.
"To the customers and communities now served by
City, M&T brings a wider array of banking products and services," continued Wilmers. "As a thrift,
City focused primarily on deposits and mortgages. M&T will build on
City's loyal customer base to create a comprehensive community banking franchise that provides a full range of checking and savings accounts, debit and credit cards, home equity loans and other lending options, plus small business and commercial banking services and our premier wealth management and corporate trust solutions through Wilmington Trust."
, M&T has
City, based in
, currently has
in assets. After the merger is completed, M&T expects to repay approximately
City's long-term borrowings by liquidating its comparably sized investment portfolio. M&T's pro forma balance sheet will have then increased by approximately
The merger has been approved by the boards of directors of each company, and is subject to certain conditions, including regulatory approvals and approval by M&T's and
City's common shareholders. After the transaction is completed, Mr. Hermance will be appointed to the boards of directors of M&T and its principal banking subsidiary, M&T Bank.
J.P. Morgan acted as financial adviser to
City and rendered a fairness opinion in connection with the transaction, and Sullivan & Cromwell LLP acted as its legal adviser. Evercore Partners rendered a fairness opinion to M&T in connection with the transaction, and Wachtell, Lipton, Rosen & Katz acted as its legal adviser.
M&T is a financial holding company headquartered in
, New York. M&T's principal banking subsidiary, M&T Bank, operates banking offices in
and the District of Columbia. Trust-related services are provided by M&T's Wilmington Trust-affiliated companies and by M&T Bank.
Hudson City Bancorp, Inc. maintains its corporate offices in
, New Jersey. Hudson City Savings Bank, a well-established community financial institution serving its customers since 1868, is the largest thrift institution headquartered in New Jersey. Hudson City Savings Bank currently operates a total of 135 branch offices in the
metropolitan and surrounding areas.