It is now confirmed that KeyCorp (NYSE:KEY) acquisition deal makes it 13th largest bank in America and 9th Largest in the state of New York. It is with $137 billion in Asset Value and increased deposits that make it the 26th Depository in the economy. Its deal to acquire Buffalo-based First-Niagara Financial Group Inc., also makes it stand as the Ohio’s second largest. It now has its foot prints across 15 states.
It has taken 9 months for the deal to be finalized, but customers will not see any changes until the end of this year if the regulatory authority (US-Office of the-comptroller-of the Currency) approves of the deal. In case the final authority signs off, then shareholder will have to realize changes in the 4th quarter. Either way, the KeyCorp shareholders will definitely enjoy the benefits of this acquisition.
Details Of The Deal
The deal was officially announced October 30th, but was only ratified by the Federal Reserve Board on the 12th of July. The value of this particular deal dropped by 10.3% during the 9-month period the negotiations were still ongoing and the company tried to meet the necessary paperwork. It was originally pegged at $4.1 billion, but now it is valued at $3.7 billion. This is solely based on the closing price of KeyCorp as of 28th of July. The deal includes additional retail branches across different areas, and these include; Connecticut, New York, Pennsylvania, and Massachusetts.
What Keycorp Leaders Think Of The Acquisition
The CEO, KeyCorp chairman, Beth Mooney, said that the acquisition is going to provide numerous opportunities for growth. Importantly, it will be able to cushion the company against any unprecedented economic events, and at the same time accelerate performance in the industry. He added that with the acquisition long-term value will be easily achievable.
Recap Of The Deal
First Niagara previously held the 2nd top position in regard to retail banking (deposit market share) in New York State only after M&T Bank. This was attributed to rapid growth and purchase of HSBC. And so, KeyCorp technical becomes the 2nd in line with previous data.