Oak Ridge-based Lakeland Bank announced it will acquire Cranbury-based 1st Constitution Bank. The combined organization will have approximately $9.6 billion in assets, total loans of $7.4 billion, and deposits of $8.2 billion. It will rank as the 5th largest bank headquartered in New Jersey.
The merger, which is expected to close in the fourth quarter of 2021 or early first quarter 2022 (subject to satisfaction of customary closing conditions), brings together two high-performing companies with complementary geographies and business lines.
Thomas J. Shara, president and chief executive officer of Lakeland and Lakeland Bank, remarked: “We are delighted to be combining with 1st Constitution and expanding Lakeland’s presence into central New Jersey. This business combination provides attractive financial attributes to shareholders of both Lakeland and 1st Constitution. This merger is consistent with our recent initiatives to expand into desirable markets. We look forward to working with 1st Constitution in delivering a broad array of business and consumer products into our expanded marketplace.”
Robert F. Mangano, president and chief executive officer of 1st Constitution, stated: “We are excited to be partnering with such a respected and well-managed institution. This merger will bring together two outstanding organizations with similar cultures as well as strong relationships in New Jersey.” In connection with the merger, it is anticipated that Mangano will be appointed to the boards of directors of Lakeland and Lakeland Bank.
Lakeland will acquire all of the outstanding shares of 1st Constitution in exchange for common shares of Lakeland and will cash out outstanding 1st Constitution options. The exchange ratio will be fixed at 1.3577 Lakeland shares for each 1st Constitution share, resulting in an aggregate transaction value of approximately $244.4 million, or $23.53 per share, which represents a 14% premium over the closing sale price per share of 1st Constitution common stock on July 9, 2021.
The Merger Agreement has been unanimously approved by the boards of directors of both companies. including receipt of required regulatory approvals and approval by the shareholders of Lakeland and 1st Constitution. In the transaction, 1st Constitution will merge into Lakeland, and 1st Constitution Bank will merge into Lakeland Bank, with Lakeland and Lakeland Bank being the surviving entities.
Key Transaction Highlights:
Keefe, Bruyette & Woods, A Stifel Company, served as financial advisor and Luse Gorman, PC served as legal counsel to Lakeland.
Raymond James served as financial advisor and Day Pitney LLP served as legal counsel to 1st Constitution.
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