Wayne Bancorp, which put itself on the block last week, should not have much trouble finding suitors in New Jersey's rapidly consolidating market, analysts said.
Analysts identified Hubco Financial Corp., Summit Bancorp, and Valley National Bancorp as possible buyers, saying the $275 million-asset bank's affluent franchise in northern New Jersey would be a magnet to companies with a presence in the state.
Wayne, which has been under pressure from shareholders to sell, said Friday that it hired Sandler O'Neill & Partners to help find a buyer. Shares continued to rise Monday, gaining $1.125 to another all-time high of $29.875.
"This is typical of what is happening all over," said Frank J. Barkocy, managing director of Josephthal Lyon & Ross Inc., New York. "We are seeing continued consolidation as banks try to increase their share in attractive markets such as New Jersey."
Hubco, based in Mahwah, N.J., is already on a buying spree. The $3.1 billion-asset company has deals pending to buy Community Financial Holding Corp., Westmont, N.J.; Poughkeepsie (N.Y.) Financial Corp., and MSB Bancorp, Goshen, N.Y. After closing all pending acquisitions, Hubco's assets would balloon to $5 billion.
"Hubco is very opportunistic," Mr. Barkocy said. "If the price is right, I wouldn't be surprised if they are looking at it."
Summit, of Princeton, N.J., has $21 billion of assets and one of the largest market shares in the state, and could use Wayne to improve its position in northern New Jersey, said Glenn Schorr, associate analyst with Gruntal & Co., New York. A deal would help Summit compete with some of the large out-of-state banks operating in New Jersey, including First Union Corp., PNC Bank Corp., and Fleet Financial Group.
Valley National was the third bank mentioned as a possible buyer. The $5 billion-asset company is also based in Wayne.
Mr. Schorr said that larger players like First Union or Fleet could be interested in buying Wayne. "It's not the normal size of their acquisitions, but New Jersey has affluent areas that everyone wants a piece of," he said. "You can toss a lot of names out there, and they could make sense from a strategic standpoint."
Wayne's announcement that it was looking for a buyer came days before its annual meeting, scheduled for today at the company's headquarters. At the meeting, activist shareholder Lawrence B. Seidman, who leads a group that owns 9.95% of Wayne's outstanding shares, will run for a seat on the board.
Harold Cook, chairman and chief executive officer of Wayne, said in a statement that the bank has learned through a phone survey that "a substantial number of shareholders, including those who support management, support a sale of the company."
Mr. Seidman said in an interview he was "happy" with the company's announcement. He said he intended to push for a sale if elected to the board.
