Hudson United Bancorp, one of the largest New Jersey-based banks, is reportedly for sale.<\/p>\n
Citing unnamed sources, Bloomberg News said Tuesday morning that the Mahwah-based bank hired Morgan Stanley to arrange an auction.<\/p>\n
Morgan Stanley officials declined to comment and referred questions to the bank. Neither the bank’s chief executive, Kenneth T. Neilson, nor Chief Financial Officer William Houlihan returned phone calls.<\/p>\n
The market reacted to the report.<\/p>\n
Hudson United shares soared 8 percent, or $2.86, ending the trading day at $38.59, a 12-month high.<\/p>\n
“Could the company be for sale? Absolutely,” said Gerard Cassidy, analyst with RBC Capital Markets. “We take these rumors seriously,” he said.<\/p>\n
Any potential buyer would have to be big enough to pay about $2.1 billion, according to Bloomberg.<\/p>\n
If Hudson United is sold it would be the largest deal involving a New Jersey-based bank since FleetBoston Bancorp acquired Summit Bancorp for $7 billion in March 2001.<\/p>\n
Industry observers say the climate for big bank deals seems to be warming up. Last month, BB&T Corp. acquired First Virginia Banks for $3.05 billion. Roslyn Bancorp agreed to be bought by New York Community Bancorp for $1.6 billion.<\/p>\n
Signs of an improving economy and higher stock prices may prompt more banks to shop around for ways to add revenue and expand turf.<\/p>\n
“The rumor mill is working overtime, and all of the economic and business indicators seem pointed in the right direction,” said David Longobardi, editor in chief of American Banker, a trade publication.<\/p>\n
Unidentified sources cited by Bloomberg named half a dozen possible bidders for Hudson United: Citigroup, J.P. Morgan Chase, Royal Bank of Scotland, Washington Mutual, and Bank of Nova Scotia.<\/p>\n
Cassidy said other potential acquirers might include FleetBoston, Wachovia Corp., and PNC Financial Services Group, which are the first-, second-, and third-largest deposit holders, respectively, in New Jersey.<\/p>\n
“I think the merger climate is going to heat up and that’s good,” said Larry Seidman, an activist shareholder – one who lobbies to maximize shareholder value in the short term – who doesn’t own shares in Hudson United.<\/p>\n
“I think by the end of the year the whole New Jersey banking landscape is going to be different,” said Jon Trugman, general partner of Pendulum Capital Management, a small hedge fund in New York City that does not own Hudson United shares.<\/p>\n
Being a takeover target would be a switch for Hudson United.<\/p>\n
Hudson United under Neilson has been one of the most aggressive acquirers of other financial institutions. In the past decade, it bought 27 financial companies.<\/p>\n
The buying spree stalled for awhile when an attempted merger of equals with Dime Bancorp announced in 1999 was thwarted by North Fork Bancorp. North Fork made a higher, hostile bid for Dime, which proved unsuccessful. Dime ended up being acquired by Seattle-based Washington Mutual.<\/p>\n
***<\/p>\n
E-mail: newman@northjersey.com<\/p>\n
(SIDEBAR, page B01)<\/p>\n
At a glance<\/p>\n
Hudson United Bancorp<\/p>\n
Description: Full-service commercial bank based in Mahwah with 206 offices in New Jersey, New York, Connecticut, and Pennsylvania.<\/p>\n
Chief Executive: Kenneth T. Neilson<\/p>\n
Assets: $8 billion<\/p>\n
Deposits: $6.2 billion<\/p>\n
New Jersey offices: 103, with 37 in Bergen and Passaic counties<\/p>\n
Sources: Hudson United Bancorp, FDIC<\/p>\n","protected":false},"excerpt":{"rendered":"
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