BMO sets $2.1 billion share sale to finance Bank of the West deal

Bank of Montreal is selling about C$2.7 billion ($2.1 billion) in shares to help fund its purchase of Bank of the West from BNP Paribas. 

The Toronto-based bank will sell about 18.1 million common shares at C$149 apiece, according to a statement Tuesday. Underwriters will have the option to buy an additional C$405 million in stock within 30 days after closing.

Brent Lewin/Bloomberg

The equity offering is a key piece of the financing for Bank of Montreal’s $16.3 billion purchase of Bank of the West, which will extend its retail footprint into the western U.S. and bulk up its commercial business.

The remainder of the transaction is being funded primarily through excess capital on the banks’ balance sheets. 

The equity offering is being underwritten on a bought-deal basis by a syndicate led by BMO Capital Markets, and is expected to close March 29.