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Maine-based Bar Harbor Bank & Trust is planning to purchase all of People’s United Bank’s branches in Central Maine.
The roughly $3.6 billion asset company said in a statement released yesterday that it has signed a definitive agreement to acquire eight branches, which come with approximately $287 million of deposits, $111 million of loans and $284 million of assets under management as of the end of the first quarter of the year.
At closing the company will pay a 6.3 percent premium on average total deposits plus a premium of 1.2 times annualized wealth management revenue and approximately $4.4 million for the fair value of premises and equipment acquired.
“We are pleased to welcome our new colleagues, customers and communities to our already deep Maine roots. We look forward to servicing their banking and wealth management needs, and to providing our full suite of personal and commercial deposit and loan products,” Bar Harbor’s President and CEO Curtis C. Simard said in a statement. “We believe this acquisition provides our existing and new customers enhanced convenience and underscores our commitment to Maine while expanding into contiguous markets in a sensible way. These branches stretch across the central Maine Interstate 95 corridor with four branches in the greater Bangor market and includes all deposits from People’s central Maine territory.”
Three of the eight branches being acquired are in Bangor and will give Bar Harbor its first retail presence in the city, while the remaining five are in Brewer, Newport, Orono, Pittsfield and Waterville. The addition of the branches will increase Bar Harbor’s total branch count to 56 in its footprint, 22 of which are in Maine and the rest in New Hampshire and Vermont.
Bar Harbor said it intends to offer continued employment to People’s United employees in the central Maine region, and that the company is well-positioned to integrate the new branches into its existing operations.
“This transaction contributes to our financial and long term strategic goals with manageable risk based on our experienced team’s history of successful acquisitions and system integrations,” Simard said. “We plan to use the acquired deposits to replace certain existing higher cost of borrowings, which will result in an immediate accretion to earnings and will support future growth with additional core funding. Incremental earnings will allow for an estimated earn-back of tangible book value per share less than a period of five years.”
The deal is anticipated to close in the fourth quarter of 2019, and is subject to regulatory approval from the FDIC and the state of Maine.
Griffin Financial Group LLC served as financial advisor to Bar Harbor Bankshares and K&L Gates served as outside legal counsel.
