West Warwick, R.I.-based Centreville Bank is buying Putnam, Conn.-based PB Bancorp Inc. and unit Putnam Bank in a deal valued at about $115.5 million.
PB Bancorp shareholders will receive $15.25 in cash per share under the deal's terms. The merger consideration represents about 145% of PB Bancorp's tangible book value as of June 30, according to a news release.
S&P Global Market Intelligence calculates the deal value to be 135.8% of common equity and 147.8% of tangible common equity and 26.8x earnings, on an aggregate basis. The deal value is 21.48% of assets and 30.10% of deposits, and the tangible book premium to deposits ratio is 9.74%.
S&P Global Market Intelligence valuations for bank and thrift targets in the Northeast region between Oct. 22, 2018, and Oct. 22, 2019, averaged 157.05% of book and 163.60% of tangible book and had a median of 17.35x last-12-months earnings, on an aggregate basis.
Centreville Bank will enter eastern Connecticut through the acquisition. The combined bank will have about $1.78 billion in assets and $1.31 billion in deposits. After the deal closes, one PB Bancorp board member will join the Centreville Bank board. Putnam Bank branches will stay open and will conduct business as Putnam Bank, a Division of Centreville Bank.
Centreville Bank will enter New London County, Conn., with three branches to be ranked No. 11 with a 1.38% share of approximately $5.33 billion in total market deposits, and will enter Windham County, Conn., with five branches to be ranked second with a 19.08% share of about $1.67 billion in total market deposits, according to S&P Global Market Intelligence data.
The deal is expected to close in the first or second quarter of 2020.
Under certain circumstances, PB Bancorp will pay Centreville Bank a $4.4 million fee is the deal is terminated.
Boenning & Scattergood Inc. acted as Centreville Bank's financial adviser, and Nutter McClennen & Fish LLP served as legal counsel. Keefe Bruyette & Woods acted as PB Bancorp's financial adviser and rendered a fairness opinion to its board. Luse Gorman PC served as PB Bancorp's legal counsel.