When Shawmut National Corp. approached Peoples Bancorp of Worcester with a buyout offer, the thrift's management was almost as surprised as Wall Street would prove to be when the deal was announced.

Woodbury C. Titcomb, president and chief executive of the Massachusetts thrift, said Monday that a sale was the last thing on his mind - until Shawmut approached him with a takeover offer less than two weeks ago.

Unlike many of its competitors, Peoples, which has $913 million of assets, was relatively unscathed by the New England downturn and was not seeking a rescuer.

"We were not in the business of selling this bank," Mr. Titcomb said in a telephone interview. "The proposal they made to us was out of the blue."

It also was too good to refuse. Shawmut agreed to pay $180 million in common stock for Peoples, or 1.76 times the thrift's book value.

|Did Its Homework'

The thrift's stock soared $9 on the news last Thursday, to $47.50, and was trading at $48 Monday afternoon.

Several analysts said the price was high for a New England savings bank - even for an apparently healthy one.

"I'm mixed on whether or not it was a good deal" for Shawmut, said Gerard Cassidy, an analyst at Hancock Institutional Equity Services. "I think they overpaid for it."

But the fact that the deal was done quickly, Mr. Cassidy said, indicates that "Shawmut did its homework from outside and was comfortable with what it saw."

Peoples earned $5.65 million, or $1.67 a share, during the first six months of the year. Moreover, its ratio of nonperforming assets to total assets was a slim 50 basis points.

Because the deal is an in-market acquisition, Shawmut should be able to realize substantial savings, analysts said. Moshe Orenbuch, who follows Shawmut, New England's third-largest bank company, for Sanford C. Bernstein & Co., said in a recent report that Shawmut can cut annual expenses at Peoples by 45%, or $12 million.

He estimated that the thrift should contribute $13 million to $14 million to Shawmut's bottom line in 1994.

Mr. Orenbuch added that Shawmut can easily realize more savings by bringing Peoples' deposit prices in line with its own.

The company has been dropping its deposit rates more aggressively than its competitors. Mr. Orenbuch estimated Shawmut would save $1 million after taxes for every 20 basis points it shaves from Peoples' rates.

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