Shareholders of First Niagara Financial Group Inc. and NewAlliance Bancshares Monday overwhelmingly approved their merger agreement despite strong disapproval from Connecticut officials.
Although regulators still need to sign off on the deal, the shareholder vote marked the first major hurdle in the approval process.
More than 90% of First Niagara's shares and more than 94% of NewAlliance's shares were in favor of the deal, in which First Niagara in Buffalo, N.Y., will acquire NewAlliance in New Haven for $1.5 billion. The acquisition will create a regional bank with operations in four Northeastern states and $29 billion in assets.
In early December, New Haven's Mayor John DeStefano and state Attorney General Richard Blumenthal, an incoming U.S. senator, challenged the deal at a press conference, claiming the union would not meet the "needs or convenience" of the community. The city may also join a lawsuit that was filed in the Connecticut Superior Court in September, seeking to block the deal.
The acquisition is expected to close in April.