Buffalo’s Niagara Financial to rebrand merged $28B entity
NEW HAVEN — The other shoe has dropped at last.
The subject of M&A speculation ever since the moment it went public a decade ago, New Haven-based NewAlliance Bancshares Inc. (NYSE: NAL) parent company of NewAlliance Bank, has agreed to be acquired by Niagara Financial Group for $1.5 billion in cash and stock.
The combination of the New Haven civic institution with the Buffalo, N.Y.-based bank, to do business as First Niagara, will yield a $29 billion banking behemoth, one of the 25 largest financial institutions in the nation.
Under terms of the deal, NAL shareholders will receive either $14.09 in cash or 1.10 shares of First Niagara stock for each share of NAL common stock they hold.
As part of the transaction NewAlliance’s 88 branches will be converted and rebranded as First Niagara locations, and NewAlLiance’s 195 Church Street headquarters will become First Niagara’s New England Regional Market Center.
"We are very proud that NewAlliance's exceptional balance sheet, credit quality and overall franchise strength enabled us to put a deal together that allows our shareholders to participate in a tremendous long-term growth opportunity, while also providing them immediate value," said NewAlliance chairman, president and CEO Peyton Patterson. "Both NewAlliance and First Niagara have been recognized as national standouts when so many other banks are struggling. In combination, we will be creating a super-regional powerhouse and accelerating our potential in ways that we couldn't individually."
Added John R. Koelmel, president and CEO of First Niagara, "We and NewAlliance share many strategic and cultural strengths, and by joining forces with them and their talented leadership team, we add another attractive and well-positioned franchise with tremendous upside potential in a region with very strong demographics."
NewAlliance, which employs 1,200 people, has $8.7 billion in assets, including $4.9 billion in loans, as well as $5.1 billion in deposits. But subject to approval by regulators as well as shareholders of both companies, which is expected in the second quarter of 2011, the NewAlliance brand will be no more.
In 2003 NewAlliance Bank rose from the ashes of New Haven Savings, when a Patterson-led new management group rode into the Elm City to take the sleepy, then-175-year-old mutual savings bank public. At the time it was widely believed the new officers and new created community board of advisors planned to make a killing on the IPO and then “flip” the company.
While the IPO stock offering came in at about $10 a share, NAL stock had recently languished in the low-$11 range until today, when at press time it was trading near $13.
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