News Summary
Rockland Trust will acquire Enterprise Bank for approximately $562 million, allowing Enterprise shareholders to receive shares and cash. The merger is expected to bolster operations in northern Massachusetts and southern New Hampshire, with key financial benefits projected. The deal is anticipated to close in the second half of 2025, pending regulatory and shareholder approvals. This consolidation reflects broader trends in the banking sector aiming to enhance service capabilities and meet customer needs.
Lowell, Massachusetts — Rockland Trust is set to acquire Enterprise Bank in a merger valued at approximately $562 million, following a definitive agreement between Independent Bank Corp., the parent company of Rockland Trust, and Enterprise Bancorp, Inc., the parent company of Enterprise Bank and Trust Company. The merger will consolidate Enterprise Bank’s operations into Rockland Trust, with Enterprise shareholders receiving $45.06 per share based on Independent’s recent closing price.
Under the terms of the merger, shareholders of Enterprise Bank will receive 0.60 shares of Independent common stock and $2.00 in cash for each share they own. The transaction is designed to qualify as a tax-free reorganization for federal income tax purposes, facilitating a tax-free exchange of shares for Enterprise shareholders. Independent plans to issue approximately 7.5 million shares of its common stock and pay a total of $27.1 million in cash as part of the deal.
The anticipated completion of the merger is scheduled for the second half of 2025, subject to necessary regulatory approvals as well as approval from Enterprise’s shareholders. Notably, a vote from Independent shareholders will not be required for the transaction to proceed. The boards of directors for both companies have unanimously endorsed the merger agreement, and Enterprise’s directors and executive officers, who own about 20.4% of the company’s outstanding shares, have pledged their support for the change.
The merger will extend Rockland Trust’s operational footprint further into northern Massachusetts and southern New Hampshire, significantly enhancing its community services and product offerings. As of September 30, 2024, Enterprise Bank reported robust financial metrics, with total assets of $4.7 billion, net loans of $3.8 billion, deposits amounting to $4.2 billion, and $1.5 billion in wealth assets under management.
Economists expect the merger to have a positive impact on Independent’s earnings per share, projecting an approximate 16% increase by 2026. Additionally, it is anticipated to enable Independent to meet its tangible book value earn-back rate within three years. Combined costs associated with the merger are expected to reach around $61.2 million before tax.
Following the transaction, George Duncan, the Chair of the Board at Enterprise Bank, will transition into an advisory role for the Independent Board, while Enterprise’s CEO, Steven Larochelle, will serve as a consultant for one year post-merger. Independent Bank Corp. has assured that all existing Enterprise Bank branches will remain operational, ensuring continuity for customers in Lowell and the surrounding areas.
This merger is part of a broader trend of banking consolidation observed in Massachusetts, driven by the need for smaller banks to increase their scale amidst competitive and regulatory pressures within the industry. With a history of successful mergers and a commitment to community-focused banking strategies, Independent Bank Corp. aims to leverage this acquisition to better serve its growing customer base.
A conference call discussing the details of the merger is scheduled for December 9, 2024, at 10:00 a.m. EST. Rockland Trust, headquartered in Massachusetts, provides various banking services through its retail branches and online platforms, while Enterprise Bank has operated since 1989, with 27 full-service branches in Massachusetts and New Hampshire, emphasizing strong customer relationships and community service.
Deeper Dive: News & Info About This Topic
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