Investors Bank to be acquired by Citizens in $3.5B deal

Investors Bancorp announced Wednesday morning that it has entered into a definitive agreement to be acquired by Citizens Financial Group, the Providence, Rhode Island-based institution that is the parent company of Citizens Bank.

The agreement and plan of merger has been unanimously approved by the boards of directors of each company. The transaction is expected to close in first or second quarter of 2022, subject to approval by the shareholders of Investors, receipt of required regulatory approvals and other customary closing conditions.

Kevin Cummings. (File photo)

Under the terms of the agreement and plan of merger, Investors’ shareholders will receive 0.297 of a share of CFG common stock and $1.46 in cash for each share of Investors they own. Following completion of the transaction, former Investors shareholders will collectively own approximately 14% of the combined company.

The implied total transaction value based on closing prices Tuesday is approximately $3.5 billion.

Key members of Investors’ management team are expected to join Citizens upon closing of the transaction in an effort to ensure business and client continuity.

Investors Chair and CEO Kevin Cummings is expected to join Citizens’ board of directors, as is Michele Siekerka, the head of the New Jersey Business & Industry Association who currently serves on the Investors’ board.

The acquisition of Investors’ approximately 150 branches enhances Citizens’ banking franchise in the state and the New York City and Philadelphia areas, while filling the gap between New England and the Mid-Atlantic. Investors has approximately $27 billion in total assets and $20 billion in deposits.

The acquisition complements Citizens’ recently announced acquisition of HSBC’s East Coast branches and national online deposits, which is expected to close in first quarter 2022. The combined Citizens franchise will operate across some of the most attractive retail and commercial banking markets in the U.S., characterized by large and dense population centers, areas of high-income households and centers of robust business activity.

Citizens Chairman and CEO Bruce Van Saun said the company is thrilled by the potential of the deals.

“The acquisition of Investors, following on the heels of the acquisition of HSBC’s East Coast branches, further strengthens our formidable franchise in the Northeast, together adding roughly 1 million customers and boosting our near- and long-term growth potential,” he said. “We are confident in our ability to successfully integrate these acquisitions, and to over time deliver the same attractive offerings to customers and strong financial performance in the New York City metro region and New Jersey as we do in other major metro areas we serve.”

Cummings agreed.

“Joining Citizens, with its broad capabilities, scale and commitment to excellence in customer service, opens exciting opportunities for our combined company,” he said. “Citizens shares Investors’ deep commitment to serving customers, supporting colleagues and giving back to local communities. Our local-market expertise and personal touch will align well with Citizens’ approach and together we will drive long-term value for all our stakeholders.”