Back to top

Image: Bigstock

Valley National (VLY) Closes USAmeriBancorp Merger Deal

Read MoreHide Full Article

Valley National Bancorp (VLY - Free Report) has completed its merger with Clearwater, FL-based USAmeriBancorp, Inc. The all-stock deal was announced in July 2017. Full systems integration is anticipated to be closed at the end of the first quarter.

In December 2017, Valley National received shareholder approval of both the companies. Earlier in October, the company got all requisite banking regulatory approvals (including that from the Fed and the Office of the Comptroller of the Currency) to close the transaction.

Deal Details & Benefits

Per the agreement terms, shareholders of USAmeriBancorp will receive 6.1 shares of Valley National for each share held. Notably, Valley National will issue nearly 65 million shares.

As of Sep 30, 2017, USAmeriBancorp, with a branch network of 29 offices, held roughly $4.5 billion in assets, $3.6 billion in net loans and $3.6 billion in deposits. Following the closure of the deal, the combined company will have more than $28 billion in assets and 238 branches.

USAmeriBancorp’s CEO, Joseph V. Chillura, joined Valley National as Regional President of the Florida West Coast and Alabama Division while the Chairman of the acquired company, Jennifer W. Steans, joined as a board member.

The transaction is expected to be accretive to Valley National's earnings per share within 12 months from closing of the transaction.

Our Take

The deal will significantly boost Valley National’s presence in the Tampa Bay market. The acquisition will also bring the company to the Birmingham, Montgomery and Tallapoosa areas in Alabama.

Ira Robbins, CEO of Valley National said, “The completion of this transaction unites two strong institutions, giving us a more significant presence in new and existing markets. Additionally, this combination provides Valley with a substantial base for future organic growth across all aspects of the business.”

Driven by stable balance sheet position, Valley National is expected to continue with its inorganic growth strategy.

However, Valley National’s shares have lost 3.6% in 2017 compared with the industry’s decline of 2.5%.



Currently, Valley National carries a Zacks Rank #3 (Hold).

Stocks Worth Considering

Some better-ranked stocks in the same space are First Commonwealth Financial Corporation (FCF - Free Report) , S&T Bancorp, Inc. (STBA - Free Report) and Orrstown Financial Services, Inc. (ORRF - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

First Commonwealth Financial’s earnings estimates for 2018 have been revised 6.8% upward over the past 30 days. The company’s share price has been up around 1% in 2017.

S&T Bancorp’s Zacks Consensus Estimate for 2018 earnings have moved 4.8% upward over the past 30 days. The company’s share price has been up 2% last year.

Orrstown Financial’s earnings estimates for 2018 have been revised 5.7% upward, over the past 30 days. In 2017, the company’s share price has been up 12.8%.

Investor Alert: Breakthroughs Pending

A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.

Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.

Click here to see them >>