People's United Financial in Bridgeport, Conn., has agreed to buy Suffolk Bancorp in Riverhead, N.Y.

The $39 billion-asset People's United said in a press release Monday that it will pay $402 million, or $33.55 a share, in stock for the $2.3 billion-asset parent of Suffolk County National Bank. The deal, which is expected to close in the fourth quarter, values Suffolk at 196% of its tangible book value.

"Suffolk County National Bank's strong Long Island presence complements our previous acquisitions and organic growth in the New York metro area," Jack Barnes, People's United's president and chief executive, said in the release.

Howard Bluver, Suffolk's president and chief executive, will join People's United as New York market president; he will assist with the integration while continuing to expand People's United's operations in New York. Bluver's "deep roots in the region, his understanding of the local economy and his proven ability for growth will continue our momentum in this important market," Barnes said.

People's United said it expects the transaction to be accretive to earnings, excluding one-time costs. It should take less than five years to earn back any dilution to tangible book value. People's United also plans to cut about half of Suffolk's annual noninterest expenses.

People's United said it expects to incur about $38 million in pretax, merger-related expenses.

J.P. Morgan Securities and Simpson Thacher & Bartlett advised People's United. Keefe, Bruyette & Woods and Wachtell, Lipton, Rosen & Katz advised Suffolk.

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