Continuing 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.