Meridian Interstate Bancorp, the holding company for East Boston Savings Bank, and Mt. Washington Cooperative Bank have signed a definitive merger agreement. As per the terms of the agreement, Mt. Washington will merge with and into East Boston Savings Bank, with East Boston Savings Bank surviving the merger. Depositors of Mt. Washington will become depositors of East Boston Savings Bank, and will have the same rights and privileges in Meridian Financial Services.
As part of the transaction, Meridian Interstate will issue additional shares of its common stock to Meridian Financial Services, in an amount based on the average of two independent valuations of the fair value of Mt. Washington. These shares are expected to be issued immediately prior to completion of the merger. In addition, Meridian Interstate will contribute capital to East Boston Savings Bank following the merger if necessary for East Boston Savings Bank to remain well-capitalized under applicable regulatory capital standards.
The transaction is expected to increase East Boston Savings Bank’s deposits from $859 million to $1.2 billion. Additionally, following completion of the transaction, Meridian Interstate or one of its affiliates will make a contribution of $250,000 to the Mt. Washington Charitable Foundation.
Sterne Agee & Leach, acted as financial advisor to Meridian Interstate. Luse Gorman Pomerenk & Schick, PC represented Meridian Interstate as legal counsel, while Foley Hoag represented Mt. Washington during this transaction.
Richard Gavegnano, chairman and CEO of East Boston Savings Bank, said: Mt. Washington’s customers can look forward to an enhanced array of products and services delivered with the same high level of service Mt. Washington consistently provides. We also look forward to welcoming the hard working Mt. Washington employees and building a better franchise together.
Edward Merritt, president and CEO of Mt. Washington, who will continue as president, Mt. Washington Division, said: “The breadth of East Boston’s product offerings, capital stength and scale will allow us to maintain, expand and enhance services and products for our customers, and the combined institution will provide a larger, more convenient branch network for both institutions customers.”
However, the merger agreement and related transactions are subject to approval.
