Regional banker M&T Bank Corporation ( MTB ) on Monday announced a take-under of fellow banker Wilmington Trust for a reported $341 million in stock.
On a per-share basis, the deal is valued at $3.84, a substantial discount to WL's Friday closing price of $7.11. In pursuant to the deal, Wilmington shareholders will receive 0.51372 shares of M&T per share of WL they own.
Additionally, M&T will repay the $330 million in federal bailout money WL was given in 2008 amid the banking crisis.
The deal is expected to close in mid-2011, and will begin adding to M&T's earnings in 2012.
M&T Bank shares were mostly flat in premarket trading Monday.
The Bottom Line
Shares of MTB have a 3.75% dividend yield, based on Friday's closing stock price of $74.75. The stock has technical support in the $70 price area. If the shares can firm up, we see overhead resistance around the $80 price level.
M&T Bank Corporation ( MTB ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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