Large New Jersey bank reveals $579M merger, significant growth into New York

OceanFirst Financial to Merge with Flushing Financial

OceanFirst Financial Corporation, based in New Jersey, has announced plans to merge with Flushing Financial Corporation. This merger aims to create a regional bank with assets totaling $23 billion, primarily serving the New Jersey, Long Island, and New York markets.

The deal is anticipated to close in the second quarter of this year. OceanFirst, which is headquartered in Red Bank, Monmouth County, is among New Jersey’s largest regional banks.

According to OceanFirst’s closing price on December 26, which was $19.76, the all-stock deal values Flushing at around $579 million.

Investment firm Warburg Pincus has also pledged to invest $225 million in newly issued stock as part of the merger completion.

The new entity will operate 71 retail locations, with approximately $17 billion in loans and about $18 billion in deposits.

This transaction will enhance OceanFirst’s footprint in Suffolk, Nassau, Queens, Brooklyn, and Manhattan.

Christopher Maher, OceanFirst’s chairman and CEO, stated that this acquisition aligns seamlessly with their growth strategy. He mentioned leveraging Flushing’s long-established distribution channels in Long Island and New York, combined with OceanFirst’s relationship-focused business model and strong product offerings.

Under the terms of the merger agreement, Flushing shareholders will receive 0.85 shares of OceanFirst common stock for each share of Flushing stock they hold.

After the merger, Flushing’s former shareholders are expected to own about 30% of the new company, while Warburg Pincus will hold roughly 12%, and existing OceanFirst shareholders will retain about 58%.

Mr. Maher will take on the role of CEO for the merged company, whereas John Brann, Flushing’s president and CEO, will serve as the non-executive chairman of the board.

The Board of Directors will consist of 17 members—10 from OceanFirst, six from Flushing, and one from Warburg Pincus.

Additionally, OceanFirst plans to sell around 9.7 million shares of common stock and non-voting stock to Warburg Pincus at $19.76 per share.

This transaction is subject to both regulatory approval and the approval of shareholders from both institutions.

Founded in 1902, OceanFirst Bank has its headquarters in Red Bank and currently manages assets totaling $14.3 billion. Flushing Bank, in operation since 1929, serves clients in Queens, Brooklyn, Manhattan, and Long Island.