Columbia Financial, Inc. to acquire Freehold Bank

ColumbiaBank, MHC, Columbia Financial, Inc. [CLBK] and Columbia Bank (collectively, “Columbia”), and Freehold MHC, FreeholdBancorp and Freehold Bank  announced today the signing of a definitive merger agreement.

Under the terms of the merger agreement, Columbia will acquire Freehold,with Freehold MHC and Freehold Bancorp merging into Columbia Bank, MHC and Columbia Financial, respectively. At the effective time ofthese mergers, Freehold Bank will convert to a federal savings bank and operate as a wholly-owned subsidiary of Columbia Financial. Asa subsidiary of Columbia Financial, current depositors of Freehold Bank will become members of, and will have the same rights and privilegesin, Columbia Bank, MHC, the mutual holding company parent of Columbia Bank, as if their accounts had been established in Columbia Bankon the date established at Freehold. As part of the transaction, Columbia Financial will issue additional shares of its common stock toColumbia Bank, MHC in an amount equal to the fair value of Freehold as determined by an independent appraiser. These shares are expectedto be issued immediately prior to completion of the mergers. In addition, following the completion of the mergers, Columbia and ColumbiaBank Foundation will support the charitable organizations serving the communities currently served by Freehold.

Freehold Bank is Monmouth County’s oldest savings institution,having provided financial services in its local community for more than 167 years, and operates from its main office and one branch office,both of which are located in Freehold, New Jersey. As of March 31, 2021, Freehold Bank had total assets of $299.8 million, loans of $155.9million, deposits of $197.2 million and equity capital of $39.5 million.

Columbia has offered full employment to all Freehold employees withFreehold Bank, and will add one current member of Freehold’s Board of Directors to Columbia Bank’s Board of Directors followingthe completion of the merger of Freehold Bank into Columbia Bank, which is anticipated to occur two years after the completion of themergers of the holding companies.

Mr. Thomas J. Kemly, Columbia’s President and Chief ExecutiveOfficer, commented: “We are pleased with the opportunity to welcome Freehold Bank and its employees and customers to Columbia Bank.The transaction will broaden our footprint into Monmouth County. As two community-minded banks, we are proud to strengthen our local impactand support new markets.”

Mr. James H. Wainwright, President and Chief Executive Officer of Freeholdcommented: “We are excited to join with Columbia Bank, a leading New Jersey-based bank with shared culture and values. The mergerwill provide an opportunity for our customers to join a larger banking network, with expanded products and services, while employees willbenefit from the opportunity to work for a rapidly growing community bank. The support of the Columbia Bank Foundation will serve as anasset to our local community and charitable organizations.”

The transaction, which has been approved by each company's Board ofDirectors, is subject to satisfaction of customary closing conditions, including receipt of various regulatory approvals, and is expectedto close in the fourth quarter of 2021 after all such conditions are met. 

On a pro forma basis, the transaction isexpected to be accretive to Columbia’s 2022 net income, but slightly dilutive to 2022 earnings per share by approximately 2%pursuant to the additional shares issued to Columbia Bank, MHC. The transaction is projected to be approximately 3% accretive tofully converted tangible book value.

Columbia was advised in this transaction by the investment bankingfirm of Boenning & Scattergood, Inc. and represented by the law firm of Kilpatrick Townsend & Stockton LLP. Freehold was advisedby FinPro Capital Advisors, Inc. and represented by the law firm of Stevens & Lee, PC.