FirstNiagara to be Acquired by KeyCorp in $4.1B Deal

Friday, October 30, 2015

Source: Rochester Business Journal

KeyCorp and First Niagara Financial Group announced Friday morning that they have reached a definitive agreement for KeyCorp to acquire First Niagara in a cash-and-stock transaction valued at some $4.1 billion.

With roughly $135 billion in assets, the combined bank will be the 13th largest commercial bank headquartered in the United States, the banks said. The acquisition will make KeyCorp a leading bank in Upstate New York, with a strong market presence in Buffalo, Albany, Syracuse and Rochester.

Buffalo-based First Niagara has $39 billion in assets and $29 billion in deposits, with 394 banking offices in New York, Pennsylvania, Connecticut and Massachusetts.

In the Rochester market, the deal would combine the No. 6 bank in term of market share, First Niagara, and No. 7, KeyBank N.A. First Niagara’s share is 8.2 percent; and KeyBank’s is 6.1 percent, according to the Rochester Business Journal’s most recent list of banks.

Under the terms of the agreement, which was approved unanimously by the boards of each company, First Niagara shareholders will receive 0.68 KeyCorp shares and $2.30 in cash for each First Niagara common share. The per-share consideration is valued at $11.40 a share based on the closing price of KeyCorp common stock on Oct. 29.

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