Amalgamated Financial buying Amalgamated Investments in $98.1M all-cash deal

Amalgamated Financial Corp., the holding company for New York-based Amalgamated Bank, agreed to acquire Amalgamated Investments Co., the holding company for Amalgamated Bank of Chicago, for about $98.1 million in cash.

The deal consideration includes an earnout of up to $1.1 million.

Upon closing, the combined company will have approximately $7.6 billion in assets, $6.8 billion in deposits, $3.7 billion in loans, $19.0 billion of trust AUM and $52.2 billion of trust assets under custody, according to the press release.

The transaction is targeted to close by the end of 2021.

Full economic benefits of the transaction are expected to be realized in 2023, assuming the deal closes in the fourth quarter. Benefits include significant cost-save opportunities through the elimination of duplicative functions driving expected EPS accretion of 17.5%.

Amalgamated Financial President and CEO Priscilla Sims Brown will lead the combined company. Amalgamated Bank of Chicago Chairman and CEO Robert Wrobel and President James Landenberger will serve as transitional consultants to the combined company through Dec. 31, 2022. Some members of Amalgamated Bank of Chicago's current board will join a new advisory board that will be established after the deal's close.

Per the merger agreement, Amalgamated Investments will be liable to pay $4 million to Amalgamated Financial if the deal is terminated due to any circumstances.

Keefe Bruyette & Woods served as financial adviser, and Nelson Mullins Riley & Scarborough LLP as legal counsel, to Amalgamated Bank. Piper Sandler & Co. served as financial adviser, and Hinshaw & Culbertson LLP as legal counsel, to Amalgamated Bank of Chicago.

Amalgamated Bank was the first publicly traded bank focused on environmental, social and governance issues. The bank had total assets of $6.6 billion, total net loans of $3.1 billion and total deposits of $5.9 billion. Additionally, as of June 30, its trust business held $39.2 billion in assets under custody and $16.6 billion in AUM. As of June 30, Amalgamated Bank of Chicago's assets were $950.1 million, according to the press release.