Hampshire First Bank enters into agreement to join NBT
NORWICH – NBT Bancorp Inc. and Hampshire First Bank (HFB) announced Wednesday that they have entered into a definitive agreement under which Hampshire First Bank will merge with and into NBT’s banking subsidiary, NBT Bank, N.A.
The merger is valued at approximately $45 million and is expected to close early in the second quarter of 2012 subject to customary closing conditions, including receipt of regulatory approvals and approval by the stockholders of HFB.
HFB is a state-chartered commercial community bank with five locations in southern New Hampshire and assets of $273 million as of Sept. 30. NBT is headquartered in upstate New York and operates a network of 128 banking locations in four states, including New York, Pennsylvania, Vermont and Massachusetts. The financial services holding company had assets of $5.5 billion as of Sept. 30.
“We are pleased to have this opportunity to join forces with Hampshire First Bank,” said NBT President and CEO Martin Dietrich. “We share a strong commitment to community and a focus on putting customers first that will contribute to the success of this partnership.” Dietrich also noted that this extension of NBT’s footprint into New Hampshire fits well with recent strategic growth initiatives, including NBT’s organic expansion into the Burlington, Vt., market beginning in 2009 and a recent four-branch acquisition in Berkshire County, Mass., completed in October.
HFB President and CEO James Dunphy added, “Hampshire First Bank was formed five years ago in response to clear demand for a community bank based in southern New Hampshire. Our partnership with NBT will enable our team of bankers to continue to serve our market as part of a financial services company that relies on local knowledge and decision making to support its customers and communities. We will also gain access to additional resources that will become available to us as part of a larger banking organization.”
Under the terms of the merger agreement, 65 percent of the outstanding shares of HFB common stock will be converted into the right to receive 0.7019 of a share of NBT common stock for each share of HFB common stock. The remaining 35 percent of outstanding shares of HFB common stock will be exchanged for $15 in cash. The transaction is valued at $15 per HFB share based on NBT’s closing stock price of $21.37 on Nov. 10. The exchange ratio shall remain fixed at 0.7019 to the extent the market value of a share of NBT common stock remains within 20 percent of $21.37, as measured during a period near the closing of the transaction. To the extent the market value of NBT common stock does not remain within the 20 percent collar, the exchange ratio will be adjusted accordingly to provide HFB stockholders with a minimum value of $12 per share and maximum value of $18 per share with respect to HFB stock exchanged for NBT common stock. HFB stockholders will have the right to elect to receive cash or NBT common stock as outlined above, subject to 65 percent of HFB common stock receiving NBT common stock in accordance with the proration and allocation procedures contained in the merger agreement.
In connection with the merger agreement, NBT also entered into voting and non-competition agreements with the directors and executive officers of HFB and entered into a voting agreement with Meridian Interstate Bancorp, Inc. Meridian Interstate Bancorp, Inc., the holding company of East Boston Savings Bank which assisted in the formation of HFB, owns approximately 40 percent of the outstanding stock of HFB.
Following the completion of the merger, Dunphy will join NBT Bank as its New Hampshire regional president.
The merger is valued at approximately $45 million and is expected to close early in the second quarter of 2012 subject to customary closing conditions, including receipt of regulatory approvals and approval by the stockholders of HFB.
HFB is a state-chartered commercial community bank with five locations in southern New Hampshire and assets of $273 million as of Sept. 30. NBT is headquartered in upstate New York and operates a network of 128 banking locations in four states, including New York, Pennsylvania, Vermont and Massachusetts. The financial services holding company had assets of $5.5 billion as of Sept. 30.
“We are pleased to have this opportunity to join forces with Hampshire First Bank,” said NBT President and CEO Martin Dietrich. “We share a strong commitment to community and a focus on putting customers first that will contribute to the success of this partnership.” Dietrich also noted that this extension of NBT’s footprint into New Hampshire fits well with recent strategic growth initiatives, including NBT’s organic expansion into the Burlington, Vt., market beginning in 2009 and a recent four-branch acquisition in Berkshire County, Mass., completed in October.
HFB President and CEO James Dunphy added, “Hampshire First Bank was formed five years ago in response to clear demand for a community bank based in southern New Hampshire. Our partnership with NBT will enable our team of bankers to continue to serve our market as part of a financial services company that relies on local knowledge and decision making to support its customers and communities. We will also gain access to additional resources that will become available to us as part of a larger banking organization.”
Under the terms of the merger agreement, 65 percent of the outstanding shares of HFB common stock will be converted into the right to receive 0.7019 of a share of NBT common stock for each share of HFB common stock. The remaining 35 percent of outstanding shares of HFB common stock will be exchanged for $15 in cash. The transaction is valued at $15 per HFB share based on NBT’s closing stock price of $21.37 on Nov. 10. The exchange ratio shall remain fixed at 0.7019 to the extent the market value of a share of NBT common stock remains within 20 percent of $21.37, as measured during a period near the closing of the transaction. To the extent the market value of NBT common stock does not remain within the 20 percent collar, the exchange ratio will be adjusted accordingly to provide HFB stockholders with a minimum value of $12 per share and maximum value of $18 per share with respect to HFB stock exchanged for NBT common stock. HFB stockholders will have the right to elect to receive cash or NBT common stock as outlined above, subject to 65 percent of HFB common stock receiving NBT common stock in accordance with the proration and allocation procedures contained in the merger agreement.
In connection with the merger agreement, NBT also entered into voting and non-competition agreements with the directors and executive officers of HFB and entered into a voting agreement with Meridian Interstate Bancorp, Inc. Meridian Interstate Bancorp, Inc., the holding company of East Boston Savings Bank which assisted in the formation of HFB, owns approximately 40 percent of the outstanding stock of HFB.
Following the completion of the merger, Dunphy will join NBT Bank as its New Hampshire regional president.
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