UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 29, 1999
WEBSTER FINANCIAL CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 0-15213 06-1187536
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(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
Webster Plaza, Waterbury, Connecticut 06702
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(Address of principal executive offices)
Registrant's telephone number, including area code: (203) 753-2921
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Not Applicable
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
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On June 29, 1999, Webster Financial Corporation ("Webster") entered into an
Agreement and Plan of Merger (the "Agreement") by which Webster will acquire New
England Community Bancorp, Inc. ("New England") in a tax-free stock-for-stock
exchange (the "Merger"). The Merger must be approved by the stockholders of New
England and by regulatory authorities, may require approval of Webster
stockholders, and is subject to various customary closing conditions. In
connection with the Agreement, Webster and New England entered into an Option
Agreement pursuant to which New England granted Webster an option, exercisable
under certain circumstances, to purchase an aggregate of 1,400,252 newly issued
shares of common stock, par value $.10 per share, of New England at an exercise
price of $22.14 per share.
Webster issued a press release on June 30, 1999 relating to the signing of
the Agreement with New England. Such press release is filed as Exhibit 99.1
hereto and is incorporated by reference herein.
Item 7. Financial Statements and Exhibits.
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(a) Not applicable.
(b) Not applicable.
(c) Exhibits
Exhibit No. Description
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99.1 Press Release of Webster Financial
Corporation dated June 30, 1999.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WEBSTER FINANCIAL CORPORATION
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(Registrant)
/s/ John V. Brennan
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John V. Brennan
Executive Vice President,
Chief Financial Officer
and Treasurer
Date: July 13, 1999
Exhibit 99.1
WEBSTER BANK TO ACQUIRE NEW ENGLAND COMMUNITY BANCORP
WATERBURY, Conn., June 30 /PRNewswire/ -- Webster Financial Corporation (Nasdaq:
WBST) today announced that it has reached a definitive agreement to
acquire New England Community Bancorp, Inc. (Nasdaq: NECB) in a tax-free,
stock-for-stock exchange valued at approximately $220 million. New England
Community Bancorp is a Windsor, Conn.-based multi-bank holding company with
three subsidiary Connecticut banks, one New Hampshire bank and a mortgage
company with offices serving both states.
Based on the terms of the agreement, NECB shareholders will receive 1.06 shares
of Webster common stock for each share of NECB they hold. This is equal to
$30.08 a share based on Webster's closing price of $28.38 a share on June 29,
1999. Webster expects to record after-tax acquisition related charges of $9.3
million for the transaction.
New England Community Bancorp's banking subsidiaries -- New England Bank, The
Equity Bank, Community Bank, and Olde Port Bank and Trust -- are all
state-chartered commercial banks with total assets of approximately $800
million, 16 banking offices in Connecticut and two offices in New Hampshire. The
New England Community Mortgage Corporation recorded $160 million in loan
originations in 1998. Please see accompanying chart for additional details.
With the addition of NECB, Webster will have approximately $10 billion in
assets, making it the fifth largest New England based bank.
The purchase price is approximately 2.9 times NECB's book value and 17.7 times
estimated 1999 earnings. The acquisition is expected to contribute positively to
Webster's earnings per share in the first year. Webster expects to account for
the transaction as a pooling of interests.
The definitive agreement, which has been approved by both companies' boards of
directors, is subject to approval by regulatory authorities and NECB
shareholders, and may require approval by Webster shareholders. Webster expects
the transaction to close in the fourth quarter of 1999.
"Our partnership with New England Community Bancorp expands Webster's franchise
in Hartford, Litchfield and Tolland Counties and significantly strengthens our
business banking presence," said James C. Smith, Webster chairman and chief
executive officer. "Customers of NECB's banks in Connecticut will benefit from
having greater convenience through our extensive network of branches and ATMs
and will enjoy a broader selection of services. At least for the time being, we
intend to run Olde Port Bank and Trust in New Hampshire as a separate
organization."
David A. Lentini, New England Community Bancorp's chairman and chief executive
officer, said, "In today's rapidly changing banking environment, our board of
directors acted on the firm belief that a merger with Webster best serves the
long-term interests of our shareholders, customers and employees. The merger
will enhance our ability to provide financial services, including expanded
business banking services as well as trust and investment management services,
insurance services, and PC banking. Our institutions share a strong commitment
to Connecticut and to New England. Following the merger, our banking customers
will be able to transact business at all Webster Bank locations and will benefit
from Webster's broad product offerings."
"New England Bank, Equity Bank, Community Bank and Olde Port Bank and Trust
customers should continue to bank as they normally do," Smith said. "We
will make the transition to Webster simple and convenient for our new
customers. "
<PAGE>
"When two banking companies merge in the same market to form a stronger bank,
there will inevitably be duplication of duties, resulting in some job
eliminations," said John Brennan, Webster's chief financial officer. "While we
have not yet finalized the number of overlapping positions, we will do all we
can to keep the number of position eliminations to a minimum, as in past
mergers. Employees whose positions are eliminated at any of the NECB banks will
be given preference for open positions in the rapidly growing Webster
organization. Our history demonstrates a pattern of successfully placing most
employees affected by our mergers."
Regarding potential branch office consolidation, Brennan said that some offices,
either current NECB or Webster locations, would be consolidated because of
geographic proximity. "We have not determined the number and locations. Usually
where branches are within a mile of each other, we can consolidate the offices
without disruption to customers," Brennan said. "It is important to note that
New England Community Bancorp customers will have vastly more branches and ATMs
following this merger."
Webster Bank was founded in 1935 and is a leading Connecticut-based financial
institution. Webster delivers consumer banking, commercial banking, mortgage,
insurance, and trust and investment management services to individuals, families
and businesses.
Webster Bank has $9.3 billion in assets and operates through a network of 115
banking offices, three commercial banking centers, and 180 ATMs, in addition to
telephone banking, video banking and PC banking. Webster has the number one or
number two deposit market share in its primary markets of Hartford, New Haven
and Litchfield counties.
Webster is also a leading, full-service commercial lender and the second-largest
mortgage lender in Connecticut. Webster Trust, the bank's trust and investment
management subsidiary, is the second-largest bank trust company based in
Connecticut. Webster's insurance subsidiary, Damman Insurance Associates, is one
of the largest agencies in the state. Webster's Access National Mortgage
subsidiary found at www.discountmortgages.com on the Worldwide Web, originates
low-cost mortgages over the Internet for customers across the United States.
For more information on Webster, including past press releases and the latest
Annual Report, visit the Webster Bank website at www.websterbank.com.
New England Community Bancorp
Bank Home Total Deposits* Branches ATMs
Office Assets*
New England Windsor, CT $576 $463 13 18
Bank & Trust million million
Equity Bank Wethersfield, $115 $96 1 1
CT million million
Community Bank Bristol, $67 $59 2 2
CT million million
Olde Port Bank Portsmouth, $56 $48 2 2
& Trust NH million million
*As of Dec. 31, 1998
Mortgage Subsidiary
New England Community Mortgage Corp. (Formed in 1998. $160 million in loan
originations in first year of operation).
Bank Branch Office Locations
New England Bank & Trust Windsor (2), Canton, East Windsor, Ellington,
Enfield, Manchester (2), Somers, South Windsor,
Suffield, West Hartford, Vernon
Equity Bank Wethersfield (single location)
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Community Savings Bank Bristol, Terryville
Olde Port Bank & Trust (NH) Portsmouth, Hampton
"Safe Harbor" Statement under the Private Securities Litigation Reform
Act of 1995: Statements in this press release regarding Webster
Financial Corp.'s business which are not historical facts are
"forward-looking statements" that involve risks and uncertainties. For
a discussion of such risks and uncertainties, which could cause actual
results to differ from those contained in the forward-looking
statements, see "Risk Factors" in the Company's Annual Report or Form
10-K for the most recently ended fiscal year.
