Provident acquiring SB One in $209M merger deal

Two New Jersey-based banks are coming together as Provident Bank and SB One Bank are merging in a deal between their parent companies, they announced Thursday.

Provident Financial Services Inc., parent of Provident, is acquiring SB One Bancorp, parent of SB One, for approximately $208.9 million in an all-stock deal, according to the financial firms’ news release.

“We are excited about our partnership with SB One,” Provident Chairman and CEO Christopher Martin said in a prepared statement. “This business combination provides attractive financial attributes to shareholders of both Provident and SB One.”

The definitive merger agreement would give a combined organization about $12 billion in assets, making the company the third-largest bank headquartered in New Jersey. Provident is based in Jersey City, while SB One is based in Paramus.

“At $12 billion in assets, the combined company comfortably surpasses the $10 billion asset threshold and provides Provident a clear management succession plan with the addition of a very skilled leader and banker in Tony Labozzetta, who will serve as president and chief operating officer of the combined company.”

Labozzetta and two SB One directors also will join the Provident board after the transaction is complete.

Terms of the deal would see Provident exchanging 1.357 shares of its stock for each common share of SB One stock, with a value of $22.09 per share as of March 11. Under the terms, SB One and its parent will merge into Provident and its parent.

“The merger between our two companies creates the size and scale necessary to compete in the markets that we serve,” Labozzetta, SB One’s CEO and president, said in a statement. “I am excited to help lead the franchise into the future with talented bankers from both of our organizations.”

The merger agreement has been unanimously approved by both companies’ boards of directors. It is expected to close in the third quarter, pending customary approvals and conditions.

For Provident, Piper Sandler & Co. was financial adviser, while Luse Gorman P.C. was legal counsel. For SB One, Keefe, Bruyette & Woods was financial adviser, while Hogan Lovells US LLP was legal counsel.