Listen to this article

Investors Bancorp Inc. has restarted acquisition efforts following a multi-year hiatus with a deal that will add seven New York branches to the Short Hills-based institution.

On Wednesday evening, Investors Bank said it will acquire Gold Coast Bank with the announcement of a signed definitive merger agreement in a deal valued at $63.6 million that is expected to close in the early part of Q1 2020.

That figure is based on Investors’ July 23, 2019 closing price of $11.20 and inclusive of outstanding dilutive securities. According to Investors, as of March 31, 2019, Gold Coast had assets of $563 million, loans of $463 million and deposits of $486 million.

The deal is subject to Gold Coast stockholder and regulatory approvals – it has already been approved by the boards of directors of both financial institutions.

“This transaction represents an effective use of capital and roughly doubles our presence in suburban Long Island,” Investors’ Chairman and Chief Executive Officer Kevin Cummings said in a prepared statement.

Founded in 2008, Islandia, N.Y.-based Gold Coast Bancorp Inc. serves customers in New York in Nassau and Suffolk counties. The deal will add six branches in the aforementioned counties, and one branch in Brooklyn, N.Y. to Investors.

In a statement, Gold Coast Chairman and Chief Executive Officer John Tsunis said the acquisition would provide the bank’s customers with expanded products and services.

“Additionally, Investors’ community banking approach and customer focus is highly consistent with the model that has made us successful since our inception,” he said.

“We are pleased to partner with Gold Coast, a commercial bank with deep ties to the Long Island community and a strong track record of growth,” Cummings said. “This transaction strengthens Investors’ current suburban Long Island franchise and deepens our presence in this large, affluent market.”

Current members of the Gold Coast board of directors will constitute a regional advisory board, created by Investors to support customer continuity, and growth, with Tsunis expected to serve as chairman, Investors said. The bank’s altruistic arm, The Investors Charitable Foundation, is also expected to increase support for Gold Coast-served communities.

Terms of the deal dictate 50 percent of Gold Coast common shares will be converted into Investors common stock, with the remaining 50 percent exchanged for cash. Shareholders of the New York bank will be able to either receive 1.422 shares of Investors common stock, or $15.75 in cash for each Gold Coast common share they own, “subject to proration to ensure that in aggregate, 50 percent of transaction consideration will be paid in the form of Investors common stock,” the bank said. Following the closing of the deal, Investors said it plans to repurchase an equal amount of its shares as are issued in the deal.

Investors’ financial advisor for the transaction was Lazard; McCarter & English LLP, with headquarters in Newark, provided legal counsel. Gold Coast was advised by Keefe Bruyette & Woods, A Stifel Co., and Boenning & Scattergood provided a fairness opinion. Windels, Marx, Lane & Mittendof LLP acted as legal counsel.

In January 2017, Investors Bank and Bank of Princeton mutually agreed to terminate their planned $154 million acquisition.