Shareholders of Roslyn (N.Y.) Bancorp are showing strong support for its proposed purchase of T R Financial, Roslyn chairman Joseph L. Mancino says.
chairman Joseph L. Mancino said company shareholders are showing strong support for the proposed merger with T R Financial Corp.
"Early returns are overwhelmingly in favor from our side," he said last week. He declined to say by what margin shareholders were supporting the deal.
In May, Roslyn agreed to buy T R Financial Corp. of Garden City, N.Y., for about $1 billion, or four times T R's book value. The merger would more than double Roslyn's size, creating a thrift with $7.7 billion of assets.
But Roslyn's share price has slipped by more than 30% since the announcement, jeopardizing the deal. T R can call it off if Roslyn's shares, which stood Friday at $18.5625, trade below $20.72 shortly before the merger is scheduled to close.
The T R board has indicated that it intends to stick with the deal, though it may ask Roslyn to increase its offer if Roslyn's share price fails to rise soon.
Institutional Shareholder Services, a firm that assesses potential mergers for mutual funds and other big stockholders, recommended last week that shareholders at both thrifts approve the merger.
"Considering the strategic benefits of the combination, we believe the merger agreement warrants shareholder support," ISS said. The report added, however, that there is "no certainty as to whether the deal will be concluded and at what price."
Because most shareholders of Roslyn are also depositors, Mr. Mancino has started running newspaper ads urging them to vote for the merger. The deadline is Dec. 22. Roslyn was a mutually held thrift until last year and is now pulicly held.
Assuming that the deal is completed, Salomon Smith Barney thrift analyst Thomas O'Donnell said in a recent report that he expects Roslyn to embark on more acquisitions in its market, Long Island, N.Y., in part because it is sitting on so much capital from last year's initial public offering.
But Mr. Mancino said he has his hands full with his first deal.
"I really can't comment on that, but there's nothing there that's right for us now," he said.
