Fast-growing Berkshire Hills Bancorp Inc. in Pittsfield, Mass., is expanding into Connecticut with a deal to acquire the Connecticut Bank and Trust Co. in Hartford for $30 million in cash and stock.
The deal, announced late Tuesday and expected to close in the second quarter of next year, would be the third acquisition for the $4 billion-asset Berkshire Hills in roughly the span of the year. In April, the company bought Rome Savings Bank in upstate New York and in July it bulked up in Western Massachusetts with its deal for hometown rival Legacy Banks.
Those deals helped boost Berkshire Hills' third-quarter net income by 27% year over year, to $4.4 million.
Connecticut Bank and Trust has $283 million of assets and eight branches in the Greater Hartford area. Though the bank is profitable — it earned $922,000 in the first half of the year — its president and chief executive David A. Lentini said in July that its earnings have suffered from weak demand for business loans.
Berkshire Hills said it would pay $7.90 for each of the seller's shares, or 28% above the stock's closing price Tuesday. The deal is valued at just under 1.4 times Connecticut Bank and Trust's book value.
In a news release, Michael P. Daly, Berkshire's president and CEO, said the acquisition would fulfill "a long-standing goal of entering the Connecticut marketplace." When the deal is completed, Berkshire Hills would have 20 branches in the Hartford/Springfield, Mass., metropolitan market, the second-largest in New England.
Connecticut Bank and Trust "has built a solid franchise in the Greater Hartford area, and this combination will provide more lending capacity and product diversity to this market," Daly said.