Provident Financial Services, Inc. (NYSE:PFS) entered into a definitive merger agreement to acquire SB One Bancorp (NasdaqGM:SBBX) from Banc Funds Company, L.L.C. and others for approximately $210 million on March 11, 2020. Under the terms of the agreement, Provident Financial Services, Inc. will acquire all of the outstanding shares of SB One Bancorp at an exchange ratio of 1.357 plus cash in lieu of fractional shares. Options of SB One will be cashed out. SB One Bancorp will merge into Provident Financial Services, Inc. and SB One Bank will merge into Provident Bank, with Provident Bank and Provident Financial Services, Inc. being the surviving entities. SB One will pay a termination fee of $9 million in case of termination of the transaction. Anthony Labozzetta, President and Chief Executive Officer of SB One Bancorp will become President and Chief Operating Officer of the combined company. Two additional members of SB One Board will be joining Providence Board. Provident Financial will appoint Anthony Labozzetta and two other Board members of SB One Bancorp to the Board of Directors of Provident Financial and Provident Bank, with one former SB One director being appointed to each of the three terms of directors comprising the Provident Financial and Provident Bank Boards of Directors.

The deal is subject to satisfaction of customary closing conditions, including regulatory approvals, approval by the shareholders of SB One Bancorp, authorization for listing on the NYSE of the shares of Provident Financial common stock to be issued in the transaction, receipt by Provident Financial and SB One of an opinion from their respective legal counsels to the effect that the merger will be treated for federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code and the effectiveness of the registration statement on Form S-4 for the Provident Financial common stock to be issued in the transaction. The Boards of both the companies unanimously approved the transaction. The annual meeting of the shareholders of SB One Bancorp will be held on June 24, 2020 to approve the transaction. As of May 29, 2020, the transaction was approved by the Federal Deposit Insurance Corporation and the New Jersey Department of Banking and Insurance, but remains subject to the approval of or waiver by the Board of Governors of the Federal Reserve System. On June 24, 2020 the shareholders of SB One approved the transaction. The transaction is expected to be completed in the third quarter of 2020. A per filing on June 24, 2020 the closing of the merger is anticipated to be as of the close of business on July 31, 2020. The transaction will be approximately 9% accretive to Provident Financial Services, Inc.'s earnings per share on a fully diluted basis.

Joseph Moeller and Matthew Dinneen of Keefe, Bruyette, & Woods, A Stifel Company acted as financial advisor and fairness opinion provider and Richard A. Schaberg, Margaret (Meg) R. McIntyre, Philip E. Altman, Sara C. Lenet and Leslie (Les) B. Reese, III of Hogan Lovells US LLP acted as legal advisors to SB One Bancorp. Piper Sandler & Co. acted as financial advisor and John J. Gorman, Jeffrey M. Cardone, Gregory M. Sobczak and Marc P. Levy of Luse Gorman, P.C acted as legal advisors to Provident Financial Services, Inc. SB One agreed to pay Keefe, Bruyette, & Woods, Inc. a total cash fee equal to 1.2% of the aggregate merger consideration, $0.25 million of which became payable to Keefe with the rendering of its opinion and the balance of which is contingent upon the closing of the merger.

Provident Financial Services, Inc. (NYSE:PFS) completed the acquisition of SB One Bancorp (NasdaqGM:SBBX) from Banc Funds Company, L.L.C. and others on July 31, 2020. Employees of SB One Bancorp joined Provident. The Board of Provident Financial Services expanded the size and appointed Edward J. Leppert and Robert McNerney along with Anthony Labozzetta as directors. Edward J. Leppert has been appointed to the Audit Committee and Robert McNerney has been appointed to the Risk Committee.