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Providence, RI and Short Hills, New Jersey, July 28, 2021 /PRNewswire/ – Citizens Financial Group, Inc. (NYSE:CFG, Citizens”, )) and Investors Bancorp, Inc. (NASDAQ:ISBC) (“Investors”) announced today that they have reached a final agreement and a merger plan under which Citizens will acquire all issued shares of investors in the form of stock and cash.
The acquisition of Investors strengthened Citizens’ banking business, adding an attractive mid-market/small business and consumer customer base, while establishing a physical presence in the Northeast and adding 154 branches in a larger area* New York City and Philadelphia Metropolitan area and localities New JerseyThe acquisition is in addition to Citizens’ recently announced acquisitions of HSBC’s East Coast branch and National Online Deposits, and is expected to close in the first quarter of 2022.The combined Citizens franchise will operate in some of the most attractive retail and commercial banking markets U.S It is characterized by dense population, dense population, gathering of high-income families, and active commercial activities.
“Following the acquisition of HSBC East Coast branch, the acquisition of Investors further strengthened our strong business in the Northeast region, together adding approximately 1 million customers, and increasing our short-term and long-term growth potential,” said Bruce Van Sang, Chairman and CEO of Citizens. “We are confident that we will successfully integrate these acquisitions and provide customers with equally attractive products and strong financial performance over time. New York City Metropolitan area and New Jersey As we do in the other major metropolitan areas we serve. “
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* Including investors’ pending acquisitions of 8 Berkshire Hills branches. |
“Joining Citizens, with its broad capabilities, scale, and commitment to excellent customer service, brings exciting opportunities for our combined company,” Kevin Cummings, Chairman and CEO of Investors. “Citizens is as committed to serving customers, supporting colleagues and giving back to the local community as Investors. Our expertise and personal style in the local market will be consistent with Citizens’ approach, and we will jointly create long-term value for all stakeholders.”
Highlights of the proposed transaction for the acquisition of investors:
Create long-term shareholder value
- Increase EPS immediately; Taking into account the huge synergies, it is expected that the fully diluted earnings per share will increase by approximately 6.4% by 2023. Combined with HSBC, the transaction will increase fully diluted earnings per share in 2023 by 8.8%
- It is expected to provide a strong internal rate of return of more than 20% and a return on invested capital of approximately 13%
- Accelerate the achievement of long-term financial goals; it is expected to increase the return on tangible common stock by approximately 120 basis points and the efficiency ratio by approximately 270 basis points
- Expected to be CET1 neutral at the close
- The tangible book value per share is moderately diluted, and it is expected to be approximately 2.6% at the close of the market, with a return of approximately 2.5 years
Determined cost savings and other synergies
- Approximately sure 130 million USD After increasing investment in brand marketing and technical capabilities, full annual cost savings have been realized; this is approximately 30% of the total non-interest operating expenses estimated by investors in 2021
- The total cost of pre-tax integration is estimated to be approximately US$400 million
- Expected revenue to increase significantly, but not included in transaction estimates
Promote Citizens’ strategy through a solid presence in important markets
- Expand on the basis of our recently announced HSBC acquisition, and build Citizens’ brand influence in an important and larger scope New York City and Philadelphia Metropolis and New Jersey Markets and mergers, adding approximately 1 million customers
- Citizens joins Investors and HSBC to enter the top 10 subway deposits in New York City
- Filling the branch gap, connecting New England with the Mid-Atlantic market, and increasing our leadership position in the Philadelphia MSA; added 154 branches, of which approximately 130 are located in the New York City MSA
- Provide branch base and brand influence to expand commercial loan and fee opportunities in the region; increase attractive middle market/small business customer base
- Opportunity to promote household growth and sharing, while accelerating consumer loans and wealth growth
According to the terms of the agreement and the merger plan, investor shareholders will receive 0.297 shares of CFG common stock and 1.46 USD Pay investors in cash for every share they own. After the transaction is completed, the former investor shareholders will jointly own approximately 14% of the combined company’s shares.Implied total transaction value based on closing price July 27, 2021 About US$3.5 billion.
It is expected that key members of the Investors management team will join Citizens to ensure the continuity of business and customers. After the transaction is completed, Kevin Cummings, Investor Chairman and Chief Executive Officer, and Michel N. SiekerkaThe current investor board member is expected to join the citizen board.
The agreement and the merger plan have been unanimously approved by the board of directors of each company. The transaction is expected to be completed in the first or second quarter of 2022, subject to investor shareholders’ approval,…
The full story on Benzinga.com
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