Generations Bancorp's Strategic Sale to ESL Federal Credit Union
Generations Bancorp's Asset Sale Decision
Generations Bancorp NY, Inc. has decided to make a significant move by agreeing to sell most of its assets and liabilities to ESL Federal Credit Union. The deal, worth $26.2 million in cash, is generating excitement among shareholders as it unfolds.
Key Details of the Transaction
As part of this agreement, Generations Bank will keep its equity at the effective time of the purchase and assumption transaction, with a few necessary adjustments. The Boards of Directors from both ESL Federal Credit Union and Generations have unanimously endorsed this transaction, indicating a shared commitment to a smooth transition.
Liquidation and Shareholder Payouts
After settling all outstanding obligations, Generations Bank is set to liquidate. This move will allow Generations Bancorp to distribute its assets to shareholders in two installments. Estimates suggest that shareholders can expect payouts ranging from $18.00 to $20.00 per share.
Payment Timeline
The initial payment is anticipated within six to nine months after the closing of the transaction, with the second installment following six to nine months post the first payment. This timeline gives shareholders a clear expectation of when to receive their monetary returns.
Expected Closing Date
The sale is projected to be finalized in the late second quarter or early third quarter of the upcoming year, contingent on regulatory approvals and other required conditions. With approximately 2.24 million shares currently outstanding, eligible depositors from Generations' recent multi-step conversion may also qualify for liquidation payments.
Expansion of ESL Federal Credit Union
This transaction presents ESL Federal Credit Union with a unique opportunity to broaden its presence in the Greater Rochester and Finger Lakes region. This expansion will enhance their asset total to an impressive $9.6 billion while solidifying their network with over 30 branches across key counties.
Statements from Leadership
Faheem Masood, the President and Chief Executive Officer of ESL Federal Credit Union, commented on the agreement, highlighting its strong alignment with both organizations' missions to serve their customers and communities effectively.
Delisting and Stock Market Changes
In connection with this transaction, Generations Bancorp NY has also made the choice to voluntarily delist its common stock from Nasdaq and intends to deregister its common stock with the SEC. Following the expected delisting, the company’s stock will be quoted on the OTCQX Market starting on a specified date while retaining the symbol "GBNY".
Price Action Overview
Currently, GBNY shares are experiencing a notable increase, reported at 39.5% higher at $15.35 during premarket trading. This price action reflects the market's positive response to the unfolding transaction and the anticipated benefits for shareholders.
Frequently Asked Questions
What is the value of Generations Bancorp's sale to ESL Federal Credit Union?
The sale is valued at $26.2 million in cash.
When can shareholders expect to receive their payouts?
Shareholders can expect initial payments between six to nine months after the transaction closes, with a second payment following six to nine months after the first.
What does the transaction mean for ESL Federal Credit Union?
This acquisition allows ESL to expand its footprint significantly, increasing its assets to $9.6 billion.
What changes will occur to Generations Bancorp's stock?
Generations Bancorp plans to delist its common stock from Nasdaq and transition to the OTCQX Market while retaining its ticker symbol "GBNY".
How many shares are currently outstanding for Generations Bancorp?
There are approximately 2.24 million outstanding shares of Generations Bancorp.
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