Magazine article American Banker

Persistent Hubco of N.J. Stymied Again in Bid for Foothold in New York State

Magazine article American Banker

Persistent Hubco of N.J. Stymied Again in Bid for Foothold in New York State

Article excerpt

An upstate New York community bank has publicly rejected persistent private merger entreaties by New Jersey's acquisitive Hubco Inc., just one month after agreeing to buy eight branches from San Francisco-based First Nationwide Bank.

MSB Bancorp's gruff refusal is the first public rebuff that the Mahwah, N.J.-based Hubco has faced since it started a spurt of 11 acquisitions in New Jersey five years ago. Hubco's purchase of Growth Financial Corp. is still pending.

"I'm not surprised that they made the offer," said Chris Bamman, junior bank analyst with Grunthal & Co. in New York. "It's part of their strategy to acquire other companies and break into the New York market."

Officials of $461 million-asset MSB Bancorp, Goshen, N.Y., decided to reveal $1.6 billion-asset Hubco's efforts to purchase the company after they apparently failed in repeated attempts to convey their desire to remain independent, according to a statement released by the company.

Hubco president and chief executive Kenneth T. Neilson declined to comment. MSB officials did not return phone calls.

According to the MSB release, Hubco, a shareholder of MSB, sent it an unsolicited proposal on July 20, without suggesting details of a transaction. At the time, according to the statement, MSB officials were reviewing financial data regarding the First Nationwide branches and chose to ignore Hubco's letter, although the board of directors was notified.

During negotiations between MSB and First Nationwide, Hubco sent a second letter, offering $35 per share for MSB, which is 1. …

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