* Sterling shareholders to get 1.2625 share of Provident
* Deal values Sterling at $11.12/shr, a premium of 11.2 pct
* Expected to close in 4th qtr
* Deal to add to Provident's 2014 earnings
April 4 Provident New York Bancorp will
buy Sterling Bancorp in a stock deal valued at $344
million to expand its presence in the New York City region, the
Sterling Bancorp shareholders will receive 1.2625 shares of
Provident for each of their shares. The deal values Sterling at
$11.12 per share based on Wednesday's closing, representing a
premium of about 11.2 percent.
Sterling has long been considered takeover target because of
its attractive small business lending franchise.
Provident shareholders will own 53 percent of the combined
company while Sterling shareholders will own the rest. ()
The combined company had a pro forma revenue of about $257
million and net income of about $41 million for 2012. The deal
is expected to generate about $34 million in cost savings while
adding to Provident's 2014 earnings.
Provident said it will raise $80 million through a debt
offering to fund the deal, expected to close in the fourth
quarter. It would convert to a national bank charter and adopt
the Sterling name.
Provident Chief Executive Jack Kopnisky will head the
company while Sterling CEO Louis Cappelli will be chairman.
Bank of America Merrill Lynch and Credit Suisse Securities
LLC served as financial advisers to Provident while Wachtell,
Lipton, Rosen & Katz acted as its legal adviser. Sterling was
advised by J.P. Morgan Securities LLC and Keefe Bruyette &
Woods. Sullivan & Cromwell LLP was Sterling's legal adviser.
Provident shares closed at $8.81 on the New York Stock
Exchange on Wednesday, while Sterling shares closed at $10.