Suffern-based Provident New York Bancorp (NYSE: PBNY) and Sterling Bancorp (NYSE:STL) announced Thursday they have entered into a definitive merger agreement in a stock-for-stock transaction valued at $344 million, based on the closing price of Provident common stock on April 4, 2013. The deal creates a combined New York financial services giant specializing in serving small-to-middle market commercial and consumer clients in the greater New York metropolitan area. Upon completion of the merger, the combined will be named Sterling Bancorp and will have nearly $7 billion in assets.
Provident, which has its headquarters in Suffern, has 11 branches throughout Rockland located in New City, Nanuet, Nyack, Orangeburg, Congers, Spring Valley, Suffern, Haverstraw, Pomona, Montebello and Stony Point. It also aquired the naming rights for the baseball stadium in Pomona, Provident Bank Park.
According to a statement about the deal, the merger with Sterling meshes with Provident’s strategy to continue to expand within the greater New York metropolitan marke. Upon closing of the merger, Provident will change its charter to a national bank and adopt the Sterling name. In the deal, Sterling Bancorp shareholders will receive a fixed ratio of 1.2625 shares of Provident New York Bancorp common stock for each share of Sterling Bancorp common stock. Upon closing, Provident New York Bancorp shareholders will own approximately 53% of stock in the combined company; Sterling Bancorp shareholders will own approximately 47%.
“This merger is a tremendous opportunity for Provident and a significant step in our strategy to expand within the greater New York metropolitan area,” said Jack L. Kopnisky, president and CEO of Provident New York Bancorp. “It provides greater diversity of product sets, clients, and revenue streams while presenting considerable potential to build our small-to-middle market and consumer client bases. The combined business will be a more effective competitor in the marketplace than either company on its own.”
The leadership team of the combined company will be assembled from both organizations with Kopnisky serving as chief executive officer for the combined company and Provident’s Luis Massiani serving as chief financial officer. Sterling Bancorp’s Louis J. Cappelli will serve as chairman of the board of directors.
The Board of Directors of the combined company is expected to have 13 members at closing, with seven members selected from among Provident directors and six selected from among Sterling directors. Provident New York Bancorp’s current chairman of the board, William F. Helmer, will be appointed to the board of directors of the combined company. Current Sterling Bancorp president and director John C. Millman also will be appointed to the board of directors and will serve as a senior advisor to the combined company.
The transaction, which has been approved by the boards of directors of both companies, is expected to close in the fourth calendar quarter of 2013. The transaction is subject to approval by shareholders from both companies, regulatory approval and other customary closing conditions.
Provident Bank offers a complete line of commercial, business, and consumer banking products and services.
Sterling Bancorp is a New York City-based financial corporation with assets of $2.7 billion. Since 1929, Sterling National Bank is the company’s principal banking subsidiary.