People's United Makes Its Move

People's United Financial(PBCT Quote) has finally made a leap into the M&A arena by agreeing to purchase Chittenden(CHZ Quote) -- a deal that will nearly double its size and create a big New England banking player.

People's, a $12 billion-asset bank based in Bridgeport, Conn., said Wednesday that it will acquire Burlington, Vt.-based Chittenden for $1.9 billion in stock and cash. The deal calls for People's to pay the equivalent of roughly $37 a share, based on the company's prior-day closing price, giving Chittenden shareholders a 31% premium.

The purchase marks People's first bank acquisition since 1998, but the deal isn't surprising. People's has been looking to do a deal that would expand it into the greater New England market, and it had openly stated that it is looking to "build the premier regional bank in the Northeast." ...