NBT Bancorp Snaps Up Alliance Financial as Regional Banks Consolidate

Andrew Klips |

NBT Bancorp Snaps Up Alliance Financial as Regional Banks ConsolidateContinuing a trend of smaller banks joining forces, upstate New York lenders Alliance Financial Corp (ALNC) and NBT Bancorp Inc. (NBTB) have come to terms to merge in a transaction valued at roughly $233 million, or about $48.24 a share. The purchase price represents an all-time high valuation for Alliance, who hit a record $41.85 per share last month, and adds $1.4 billion worth of assets to NBT’s $6 billion portfolio.

Per the terms of the agreement, shareholders of Alliance will receive 2.1779 shares of NBTB. The purchase price is a 22 percent premium to Friday’s closing price for Alliance. The transaction, which will widen NBT’s footprint in the Syracuse area, is expected to close in the second quarter of 2013, pending all approvals. Alliance is headquartered in Syracuse and operates 28 banks throughout central New York that will become NBT banks upon closing of the deal. Norwich-based NBT has 137 locations in New York, Vermont, and Massachusetts; as well as other companies in the northeast.

“We have an experienced conversion team in place that will work closely with Alliance representatives to minimize the impact to customers and facilitate a smooth conversion to NBT Bank,” said NBT President and CEO Martin Dietrich.
Upon closing, Alliance CEO and chairman Jack Webb will become a member of the NBT board and serve as executive vice president, strategic support. Two other members from Alliance’s board will hop ship to the NBT board.

The NTB move follows another New York bank, Buffalo-based M&T Bank Corp. (MTB) buying Hudson City Bancorp (HCBK) and its locations strewn from Virginia to Connecticut for $3.7 billion.

Shares of NBTB have shed about 3 percent with the acquisition news, while shares of Alliance are up about 17 percent, trading just shy of the purchase price.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
HCBK Hudson City Bancorp Inc n/a n/a n/a 0
MTB M&T Bank Corporation 116.10 1.56 1.36 708,905
NBTB NBT Bancorp Inc. 32.87 0.56 1.73 130,697
SCQ Stellus Capital Investment Corporation 6.50% Notes 25.32 0.00 0.00 0

Comments

Emerging Growth

CohBar Inc.

CohBar Inc is a research stage biotechnology company. The Company conducts investigational research into Mitochondrial-Derived Peptides to evaluate their therapeutic potential through in vitro and in vivo models.

Private Markets

GoCoin

Blockchain currencies (e.g. Bitcoin) provide a new disruptive way to transfer value between parties over the internet as opposed to going through banks. GoCoin provides online merchants with a suite…

Wealthfront

Wealthfront is an automated investment service that serves as an alternative to traditional financial advisory services. The company manages a diversified, continually rebalanced portfolio of index funds on their clients’…