ROCKLAND, Mass. & PEABODY, Mass.–(BUSINESS WIRE)–Independent Bank Corp. (NASDAQ Global Select Market: INDB), parent of Rockland Trust Company, and Meridian Bancorp, Inc. (NASDAQ Global Select Market: EBSB), parent of East Boston Savings Bank, have signed a definitive merger agreement for Independent to acquire Meridian and Rockland Trust to acquire East Boston Savings Bank.
The merger agreement provides that each Meridian stockholder will receive 0.2750 of a share of Independent common stock for each share of Meridian common stock. The transaction is intended to qualify as a tax-free reorganization for federal income tax purposes and to provide a tax-free exchange for Meridian stockholders for the Independent common stock consideration they receive.
Independent anticipates issuing approximately 14.2 million shares of its common stock in the merger. Based upon Independent’s $79.57 per share closing price on April 21, 2021, the transaction is valued at approximately $1.15 billion and the aggregate consideration represents 150% of Meridian’s tangible book value. The merger is expected to close in the fourth quarter of 2021 subject to customary closing conditions, including customary regulatory approvals and approvals of Meridian and Independent shareholders.
“This merger is consistent with our strategy of acquiring banks in overlapping and adjacent markets who share our relationship-focused style of banking,” said Christopher Oddleifson, the President and Chief Executive Officer of Independent and the Chief Executive Officer of Rockland Trust. “East Boston Savings Bank has been committed to building meaningful connections with their customers since 1848 and we are excited to work alongside them to deepen those relationships with expanded products, services, and technology. At the same time, we look forward to increasing our presence in and around the city and reinforcing our position as the Boston area’s premier community-focused commercial bank.”
“This transaction brings together two strong banks with a long and rich history serving and investing in our local communities,” said Richard J. Gavegnano, the President and Chief Executive Officer of East Boston Savings Bank. “We are excited to join a like-minded organization dedicated to creating exceptional customer experiences, built on trust and quality service, while also providing an attractive return to our stockholders.”
East Boston Savings Bank was founded in 1848 and conducts its business from 42 full-service locations, one mobile branch and three loan centers in the greater Boston metropolitan area. As of March 31, 2021 Meridian had $6.5 billion in total assets, $5.3 billion in loans, and $5.1 billion in deposits.
“Following this merger, Rockland will have approximately $20 billion in assets. In addition to the market leading commercial lending capabilities, this acquisition will further enhance our core deposit franchise value and allow for the expansion of Rockland’s broad financial product set to an expanded business and consumer customer base,” said Christopher Oddleifson.
Independent anticipates that: the transaction will (i) be approximately 7.9% immediately accretive to tangible book value per share; (ii) be approximately 23% accretive to its 2022 earnings per share, assuming fully phased-in cost saves; and, (iii) generate an internal rate of return of approximately 16%. Combined merger-related charges are expected to be approximately $64 million before tax, in the aggregate, incurred in 2021.
The boards of directors of each company have unanimously approved the transaction. The transaction is subject to certain conditions, including the receipt of required regulatory approvals, approval by the stockholders of both Meridian and Independent, and other customary conditions. Meridian’s directors and executive officers who currently own, in the aggregate, about 3.5% of Meridian Bancorp, Inc.’s outstanding shares have signed voting agreements pursuant to which they have agreed to vote their shares in favor of the merger.
Keefe, Bruyette & Woods, a Stifel Company, acted as financial advisor to Independent and Wachtell, Lipton, Rosen & Katz served as legal counsel. Raymond James & Associates, Inc. acted as financial advisor to Meridian and Luse Gorman, PC served as legal counsel.
ABOUT INDEPENDENT BANK CORP.
Independent Bank Corp. (NASDAQ Global Select Market: INDB) is the holding company for Rockland Trust Company, a full-service commercial bank headquartered in Massachusetts. Rockland Trust was named to The Boston Globe’s “Top Places to Work” 2020 list, an honor earned for the 12th consecutive year. In 2020, Rockland Trust was ranked the #1 Bank in Massachusetts according to Forbes World’s Best Banks list. Rockland Trust has a longstanding commitment to equity and inclusion. This commitment is underscored by initiatives such as Diversity and Inclusion leadership training, a colleague Allyship mentoring program, numerous Employee Resource Groups focused on providing colleague support and education, reinforcing a culture of mutual respect and advancing professional development, and Rockland Trust’s sponsorship of diverse community organizations through charitable giving and employee-based volunteerism. Rockland Trust is deeply committed to the communities it serves, as reflected in the overall “Outstanding” rating received in its most recent Community Reinvestment Act performance evaluation. Rockland Trust offers a wide range of banking, investment, and insurance services. The Bank serves businesses and individuals through approximately 100 retail branches, commercial and residential lending centers, and investment management offices in eastern Massachusetts, including Greater Boston, the South Shore, Cape Cod and Islands, Worcester County, and Rhode Island. Rockland Trust also offers a full suite of mobile, online, and telephone banking services. Rockland Trust is an FDIC member and an Equal Housing Lender. To find out why Rockland Trust is the bank “Where Each Relationship Matters®,” please visit RocklandTrust.com.
ABOUT MERIDIAN BANCORP, INC.
Meridian Bancorp, Inc. (NASDAQ Global Select Market: EBSB) is the holding company for East Boston Savings Bank. East Boston Savings Bank, a Massachusetts-chartered stock savings bank founded in 1848, operates 43 branches in the greater Boston metropolitan area, including 42 full-service locations and one mobile branch. East Boston Savings Bank offers a variety of deposit and loan products to individuals and businesses located in its primary market, which consists of Essex, Middlesex, Norfolk and Suffolk Counties, Massachusetts. For additional information, visit www.ebsb.com.
