Kearny Financial Corp. (Nasdaq:KRNY), the holding company for
Kearny Bank (“Kearny”), and Clifton Bancorp Inc. (Nasdaq:CSBK), the
holding company for Clifton Savings Bank (“CSBK”), announced today
that the companies have entered into a definitive agreement
pursuant to which Kearny will acquire CSBK in an all-stock
transaction. The definitive agreement has been unanimously
approved by the Boards of Directors of both companies. Under
the terms of the agreement, CSBK will merge with and into Kearny,
and each outstanding share of CSBK common stock will be exchanged
for 1.191 shares of KRNY common stock. The transaction is
valued at an estimated $408 million, or approximately $18.25 per
CSBK share, based upon the 10 day volume-weighted average common
stock price of $15.32 for Kearny Financial Corp. as of October 31,
2017. Upon closing, Kearny shareholders will own approximately 76%
of the combined company and CSBK shareholders will own
approximately 24% of the combined company.
With the addition of 12 branches throughout Bergen,
Passaic, Hudson, and Essex Counties, the merger will enhance
Kearny’s footprint across dynamic and desirable northern New Jersey
markets. As of September 30, 2017, CSBK had approximately
$1.6 billion of assets, $1.1 billion of loans, and $915 million of
deposits. On a pro forma basis, as of September 30, 2017, the
combined company is expected to have approximately $6.5 billion of
assets, $4.4 billion of loans, and $3.9 billion of deposits.
“I am pleased to announce the strategic combination
of these two strong New Jersey based community banks”, said Craig L
Montanaro, President and Chief Executive Officer of
Kearny. “We believe that this partnership is an
excellent fit from both a cultural and operating model
perspective. Together, the combined company provides
for an enhanced customer experience through an expanded branch and
ATM network, more diverse products and services and strengthened
ties to our communities through the financial support of the Kearny
Bank Foundation.”
“Kearny is an excellent partner for CSBK,” said
Paul M. Aguggia, President and Chief Executive Officer of CSBK. “We
believe that this strategic combination creates a stronger
organization that will benefit our customers and create
opportunities for our employees. We are proud of the value
that we have delivered to our shareholders since our second-step
conversion and are excited by the prospects for the combined
company.”
On a pro forma basis, the transaction is expected
to be accretive to Kearny’s fiscal 2019 earnings per share by
approximately 40%. Tangible book value dilution is expected
to be approximately 2.3%, with an earn-back period of approximately
2.4 years.
Subject to approval by each company’s shareholders,
as well as regulatory approvals and other customary closing
conditions, the transaction is currently expected to close late in
the first calendar quarter of 2018, or early in the second calendar
quarter of 2018. Effective at the closing of the transaction,
Mr. Aguggia and two other members of the Board of Directors of CSBK
will join the Board of Directors of both Kearny and Kearny
Bank.
Keefe, Bruyette & Woods, Inc. served as
financial advisor to Kearny, and Luse Gorman, PC served as its
legal counsel. Sandler O'Neill + Partners, L.P. served as
financial advisor to CSBK, RP Financial, LC. rendered a fairness
opinion to CSBK in connection with the transaction,
and Kilpatrick Townsend & Stockton LLP served as legal
counsel to CSBK.
Conference Call
Kearny will host a conference call to discuss the
transaction on Thursday, November 2, 2017 at 10:00 a.m. Eastern
Time. Those wishing to participate in the call may dial
toll-free (888) 317-6016. Investor presentation materials
related to this transaction will be made available prior to the
conference call at www.kearnybank.com.
About Kearny Financial Corp.
Kearny Financial Corp. is the parent company of
Kearny Bank. Kearny Bank operates from its administrative
headquarters in Fairfield, New Jersey, and a total of 42 retail
branch offices located throughout northern and central New Jersey
and Brooklyn and Staten Island, New York. At September 30,
2017, Kearny Financial Corp. had approximately $4.8 billion in
total assets. Kearny Bank was recently named to Forbes’ list
of the 50 Most Trustworthy Financial Companies.
About Clifton Bancorp Inc.
Clifton Bancorp Inc. is the holding company for
CSBK (Clifton Savings Bank), a federally chartered savings bank
headquartered in Clifton, New Jersey. CSBK is a metropolitan,
community-focused bank serving residents and businesses in its
market area through 12 full-service banking centers.
Forward Looking Statements
This communication contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements include, but
are not limited to, statements about (i) the benefits of the merger
between Kearny and CSBK, including anticipated future results, cost
savings and accretion to reported earnings that may be realized
from the merger; (ii) Kearny and CSBK’s plans, objectives,
expectations and intentions and other statements contained in this
presentation that are not historical facts; and (iii) other
statements identified by words such as “expects,” “anticipates,”
“intends,” “plans,” “believes,” “seeks,” “estimates” or words of
similar meaning. Annualized, pro forma, projected and estimated
numbers are used for illustrative purpose only, are not forecasts
and may not reflect actual results.
Forward-looking statements involve risks and
uncertainties that may cause actual results to differ materially
from those in such statements. The following factors, among others,
could cause actual results to differ materially from the
anticipated results expressed in the forward-looking statements:
the businesses of Kearny and CSBK may not be combined successfully,
or such combination may take longer than expected; the cost savings
from the merger may not be fully realized or may take longer than
expected to be realized; operating costs, customer loss and
business disruption following the merger may be greater than
expected; governmental approvals of the merger may not be obtained,
or adverse regulatory conditions may be imposed in connection with
governmental approvals of the merger or otherwise; the stockholders
of CSBK or Kearny may fail to approve the merger; the interest rate
environment may further compress margins and adversely affect new
interest income; the risks associated with continued
diversification of assets and adverse changes to credit quality;
and difficulties associated with achieving expected future
financial results. Additional factors that could cause actual
results to differ materially from those expressed in the
forward-looking statements are discussed in Kearny’s and CSBK’s
reports (such as the Annual Report on Form 10-K, Quarterly Reports
on Form 10-Q and Current Reports on Form 8-K) filed with the
Securities and Exchange Commission (the “SEC”) and available at the
SEC’s Internet website (www.sec.gov). All subsequent written and
oral forward-looking statements concerning the proposed transaction
or other matters attributable to Kearny or CSBK or any person
acting on their behalf are expressly qualified in their entirety by
the cautionary statements above. Except as required by law, Kearny
and CSBK do not undertake any obligation to update any
forward-looking statement to reflect circumstances or events that
occur after the date the forward-looking statement is made.
Additional Information About the Proposed
Merger and Where to Find It
Investors and stockholders are urged to carefully
review and consider each of Kearny’s and CSBK’s public filings with
the SEC, including, but not limited to, their Annual Reports on
Form 10-K, their proxy statements, their Current Reports on Form
8-K and their Quarterly Reports on Form 10-Q. The documents filed
by Kearny with the Securities and Exchange Commission (the “SEC”)
may be obtained at the SEC’s Internet site (www.sec.gov). You
will also be able to obtain these documents, free of charge, from
Kearny at www.kearnybank.com under the tab “Company Info” under
“Investor Relations” or by requesting them in writing to Kearny
Financial Corp., 120 Passaic Avenue, Fairfield, New Jersey 07004,
Attention: Sharon Jones, or from CSBK at www.csbk.bank under the
tab “About Us” under “Investor Relations” or by requesting them in
writing to Clifton Bancorp Inc., 1433 Van Houten Avenue, Clifton,
New Jersey 07015, Attention: Michael Lesler.
In connection with the proposed merger, Kearny will
file with the SEC a registration statement on Form S-4 that will
include a joint proxy statement of Kearny and CSBK and a prospectus
of Kearny, as well as other relevant documents concerning the
proposed merger. Investors and stockholders are urged to read the
registration statement and the joint proxy statement/prospectus
regarding the proposed merger when it becomes available and any
other relevant documents filed with the SEC, as well as any
amendments or supplements to those documents, because they will
contain important information. Copies of the registration statement
and joint proxy statement/prospectus and the filings that will be
incorporated by reference therein, as well as other filings
containing information about Kearny and CSBK, when they become
available, may be obtained at the SEC’s Internet site
(www.sec.gov). Free copies of these documents may be obtained as
described in the preceding paragraph.
CSBK and Kearny and certain of their respective
directors and executive officers may be deemed to be participants
in the solicitation of proxies from the stockholders of Kearny and
CSBK in connection with the proposed merger. Information
about the directors and executive officers of Kearny is set forth
in the proxy statement for the Kearny 2017 annual meeting of
stockholders, as filed with the SEC on Schedule 14A on September
15, 2017. Information about the directors and executive officers of
CSBK is set forth in the proxy statement for the CSBK 2017 annual
meeting of stockholders, as filed with the SEC on Schedule 14A on
June 29, 2017. Additional information regarding the interests of
those participants and other persons who may be deemed participants
in the transaction and a description of their direct and indirect
interests, by security holdings or otherwise, may be obtained by
reading the joint proxy statement/prospectus and other relevant
documents regarding the proposed merger to be filed with the SEC
when they become available. Free copies of these documents may be
obtained as described above.
For further information, contact:
Kearny Financial Corp.
Craig L. Montanaro, President and Chief Executive Officer, or
Eric B. Heyer, Executive Vice President and Chief Financial Officer
(973) 244-4500
Clifton Bancorp Inc.
Michael Lesler, Executive Vice President, Chief Operating Officer and Corporate Secretary
(973) 473-2200
Clifton Bancorp Inc. (MM) (NASDAQ:CSBK)
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