To expand its Massachusetts market, Citizens Financial Group said Monday it had agreed to acquire Grove Bank, Boston, for $87.1 million in cash.
Grove Bank, with assets of $599 million, has branches in Chestnut Hill, Brookline, Newton, Framingham, and Stoughton.
Grove is to be merged into Citizens Bank of Massachusetts, a subsidiary of Providence, R.I.-based Citizens Financial.
The transaction price represents 1.78 times Grove's book value, or $51 per share, and includes Grove's pending acquisition of Greater Boston Bank, which was announced in August and is scheduled to close in January.
Citizens' purchase of Grove is expected to be completed in the spring, assuming shareholder and regulatory approval.
After the deal closed, Citizens Bank of Massachusetts would have $5 billion in assets, with 74 branch offices in eastern Massachusetts. It would become the third-largest bank in Massachusetts, displacing State Street Boston Corp., which is currently third behind Fleet Financial Group and Bank of Boston Corp.