ConnectOne Bancorp, the holding company of ConnectOne Bank, has agreed to merge with First National Bank of Long Island’s parent company First of Long Island, in an all-share deal valued at around $284m.
According to the terms of the definitive agreement, shareholders of First of Long Island will receive 0.5175 shares of ConnectOne Bancorp common stock for each share of First of Long Island common stock.
The consideration represents a value of $12.4 per First of Long Island share. This is based upon the closing common stock price of $23.97 for ConnectOne Bancorp as of 4 September 2024.
Headquartered in New York, First of Long Island provides a range of lending, deposit, investment, and digital products. It has around $4.2bn of assets, $3.3bn of loans, and $3.4bn of deposits.
Through the merger, ConnectOne Bancorp expects to establish a leading middle-market bank dedicated to serving the Greater New York Metro Area.
The combined entity, which will operate under the ConnectOne Bancorp brand, is expected to achieve significant scale, with assets totalling $14bn and a market capitalisation exceeding $1.2bn. It will also have $11bn each in total deposits and total loans.
First National Bank of Long Island CEO Chris Becker said: “Joining forces with ConnectOne begins the next chapter in The First National Bank of Long Island’s story.
“Together, we leverage the strengths, expertise, and resources of both companies to offer our clients the muscle and support of a $14bn institution with a people-first culture backed by modern infrastructure.”
Additionally, the deal will strengthen ConnectOne Bancorp’s presence on Long Island, with 30% of the pro forma deposit base in Nassau and Suffolk Counties.
In line with the merger, ConnectOne Bancorp intends to raise nearly $100m in subordinated debt before the closing of the transaction. The net proceeds of the funding will be downstreamed in the form of equity capital to ConnectOne Bank.
ConnectOne Bank chairman and CEO Frank Sorrentino III said: “This transaction is a natural fit as both ConnectOne and First of Long Island share a strong credit culture, a long-term track record of strong financial performance, and a deep commitment to putting clients at the centre of our businesses.”
Subject to First of Long Island and ConnectOne Bancorp shareholders’ approval, along with regulatory approvals and other customary conditions, the transaction is anticipated to be completed in mid-2025.
Keefe, Bruyette & Woods was the financial adviser to ConnectOne Bancorp, while Windels Marx Lane & Mittendorf served as its legal counsel.
Piper Sandler acted as financial adviser to First of Long Island, and Luse Gorman was its legal counsel.
