Country Bank to be Acquired by OceanFirst Bank for $102 Million

Real Estate In-Depth | August 2019

Country Bank was bestowed with the 2018 Burke Award by the Burke Rehabilitation Hospital’s board of trustees at the 23rd Annual Burke Award Dinner held in June 2018. From left: Joseph M. Murphy Jr., president and CEO of Country Bank, and Carolyn T. Murphy, vice president and chief marketing officer of Country Bank present Jeffrey Menkes, president and CEO at Burke Rehabilitation Hospital, JoAnn M. Murphy, vice chair of Country Bank and Joseph M. Murphy, chairman of Country Bank.

NEW YORK—Country Bank, which began operations in 1988 and later relocated its headquarters to New York City, will be merged into OceanFirst Bank in a deal valued at $102.2 million.

Toms River, NJ-based OceanFirst Financial Corp., parent company of OceanFirst Bank announced its intent to merge with Country Bank Holding Company, Inc., parent company of Country Bank. OceanFirst also announced its proposed merger with Two River Bancorp, parent company of Two River Community Bank, which is headquartered in Tinton Falls, NJ.

“We are excited for both Two River and CYHC (Country Bank Holding Co.) shareholders to join the OceanFirst family, as both institutions share a similar operating philosophy and this provides us an opportunity to further enhance our presence in New Jersey and build upon our lending initiatives in metropolitan New York,” said Christopher D. Maher, OceanFirst chairman and CEO. “We believe the addition of these two high-performing franchises will further leverage the significant investments we have made in people, processes and technology and positively impact our earnings potential. We look forward to continuing to provide our customers with extraordinary service and deliver enhanced value to our stockholders.”

Based on OceanFirst’s closing stock price on August 8 of $23.14, the Country Bank transaction is valued at approximately $46,280.00 per CYHC common share or approximately $102.2 million in the aggregate. The Two River transaction is valued at approximately $20.79 per Two River common share or approximately $182.8 million in the aggregate. ”

“We are very pleased about partnering with a high-performing company that shares our community banking culture and values. We find the strategic fit of the two organizations compelling, especially for our customers that will benefit from the broader array of products and services, and for our stockholders,” said Joseph M. Murphy, CYHC chairman and CEO. “We will leverage the new resources and products available to us through OceanFirst Bank and are attracted to the opportunity to operate in our current markets with a significantly larger scale.”

Both the Two River and CYHC merger agreements have been unanimously approved by the OceanFirst Board of Directors. The Two River Board of Directors has unanimously approved the Two River merger agreement. The Two River merger is expected to close in the first quarter of 2020, subject to Two River receiving the requisite approval of its shareholders, receipt of all required regulatory approvals, and fulfillment of other customary closing conditions. The CYHC Board of Directors has unanimously approved the CYHC merger agreement. The CYHC merger is expected to close in the first quarter of 2020, subject to approvals.

Piper Jaffray & Co. served as financial advisor to OceanFirst and Skadden, Arps, Slate, Meagher & Flom LLP served as OceanFirst’s legal counsel. Boenning & Scattergood, Inc. served as financial advisor to Two River and Stevens & Lee served as Two River’s legal counsel. Sandler O’Neill & Partners, L.P. served as financial advisor to CYHC and Luse Gorman, PC served as CYHC’s legal counsel.

CYHC was founded in 1988 and provides banking services to small businesses and individuals through its network of five Country Bank branches located in the metropolitan New York market.

Initially launched in Carmel, Country Bank moved its headquarters to Manhattan in 2001, and in 2015 cut the ribbon on its new flagship branch on Third Avenue between 41st and 42nd Street. The bank is controlled by the Murphy family and specializes in small business and commercial real estate lending. In addition to its Manhattan branch, Country Bank has additional branches in Midtown New York City, Riverdale, Woodlawn and Scarsdale.

As of June 30, 2019, CYHC had $783.4 million in assets, $592.4 million in loans, $649.7 million in deposits and $67.5 million in shareholders’ equity. Under the terms of the CYHC merger agreement, upon completion of the merger, shareholders of CYHC will be entitled to receive 2,000 shares of OceanFirst common stock for each outstanding share of CYHC common stock.

Founded in 2000, Two River is a full-service community bank operating 14 branch locations and 2 loan production offices in Monmouth, Ocean, Union and Essex counties. At June 30, 2019, Two River had $1.2 billion in assets, $953.1 million in loans, $972.6 million in deposits and $121.4 million in shareholders’ equity. Under the terms of the Two River merger agreement, upon completion of the merger, shareholders of Two River will be entitled to receive 0.6663 shares of OceanFirst common stock and $5.375 in cash for each outstanding share of Two River common stock.