People's United Financial, Inc. (NASDAQ: PBCT), the holding company for People's United Bank, N.A., announced today a definitive agreement pursuant to which People's United Financial will acquire Suffolk Bancorp (NYSE: SCNB), of Riverhead, NY, the holding company for Suffolk County National Bank, in a 100% stock transaction valued at approximately $402 million. Completion of the transaction is subject to customary closing conditions, including the receipt of regulatory approval and the approval of Suffolk Bancorp's shareholders.
"We are proud to welcome Suffolk County National Bank to People's United Bank," said Jack Barnes, President and Chief Executive Officer of People's United Financial. "With the 9th largest market share in Suffolk County, a solid relationship-banking approach and loyal, long-tenured customers, Suffolk County National Bank's strongLong Island presence complements our previous acquisitions and organic growth in the New York Metro area."
"I couldn't be more pleased to be a part of People's United," said Howard C. Bluver, President and Chief Executive Officer of Suffolk Bancorp. "The highly regarded People's United brand, broad range of products and services and unique positioning across several attractive markets will benefit Suffolk Bancorp shareholders, customers and employees alike. It is also clear to me that our respective community-oriented cultures, devotion to the highest levels of customer service and conservative risk management philosophies align perfectly. We look forward to leveraging the strengths of our combined organizations to create additional value for all of our current and future stakeholders."
Bluver will join People's United Bank as New York Market President and will guide the integration of Suffolk Bancorp while continuing to expand the People's United franchise in New York. "Howard's deep roots in the region, his understanding of the local economy and his proven ability for growth will continue our momentum in this important market," said Barnes.
People's United Bank and People's United Community Foundation have a strong tradition of charitable contributions and investing in communities. Recognizing Suffolk Bancorp's important role in the region, the combined company will enhance efforts to address the needs of individuals, families, and businesses on Long Island with the creation of a regional advisory board. The board, comprising members of Suffolk's Board of Directors, will be established upon closing of the transaction and will provide insight and guidance in these and other areas.
People's United expects the transaction to be accretive to earnings, excluding one-time costs, with an IRR of approximately 17% and a tangible book value earn-back under five years. The transaction is expected to close late in the fourth quarter of 2016.
Under the terms of the definitive agreement, which has been approved by both companies' boards of directors, Suffolk Bancorp shareholders will receive 2.225 shares of People's United Financial stock for each Suffolk Bancorp share. The transaction is valued at $33.55 per Suffolk Bancorp share, based on the closing price of People's United's common stock on June 24, 2016. The receipt of People's United Financial stock by shareholders of Suffolk Bancorp is expected to be tax-free.
J.P. Morgan Securities LLC served as financial advisor to People's United and Simpson Thacher & Bartlett LLP served as legal counsel to People's United.
Keefe, Bruyette & Woods, Inc. served as financial advisor to Suffolk Bancorp, and Wachtell, Lipton, Rosen & Katz served as legal counsel to Suffolk Bancorp.
Conference Call Information
More information regarding the strategic and financial implications of the acquisition will be provided in a People's United conference call and presentation taking place today, June 27, 2016, at 9 a.m. ET. The call will be broadcast live via http://edge.media-server.com/m/p/dyfn2pph through the company's website peoples.com. To access the conference call, dial-in information is as follows: Domestic: 877-930-7765 and International: 253-336-7413. Conference ID# 40471796. A replay of the presentation will be available June 27 (midnight) –July 3 (midnight): Domestic: 855-859-2056 and International: 404-537-3406. Conference ID# 40471796.
About People's United Bank, N.A.
People's United Bank, N.A. is a subsidiary of People's United Financial, Inc. (NASDAQ: PBCT), a diversified financial services company with over $39 billion in assets. People's United Bank, founded in 1842, is a premier, community-based, regional bank in the Northeast offering commercial and retail banking, as well as wealth management services through a network of nearly 400 branches in Connecticut, New York, Massachusetts,Vermont, New Hampshire and Maine. Visit us at peoples.com.
About Suffolk Bancorp
Suffolk Bancorp (NYSE: SCNB) is a one-bank holding company that provides commercial banking and financial services through Suffolk County National Bank ("SCNB"), its wholly owned subsidiary. Founded in 1890, SCNB is headquartered in Riverhead, NY and serves the Long Island market, incorporating Long Island's East End, western Suffolk, and Nassau counties as well as Manhattan and the other Boroughs. SCNB is a nationally chartered commercial bank offering a full range of products and services including deposit accounts, commercial, multi-family and consumer lending, residential mortgages, cash management, and investment services.
