Dive Brief:

• Rockland, Massachusetts-based Independent Bank Corp. is acquiring Lowell-based Enterprise Bancorp in a cash-and-stock transaction valued at roughly $562 million, the companies announced Monday.
• The transaction will create an entity with $25 billion in assets, $20 billion in deposits, $19 billion in loans and $8.7 billion in wealth assets under administration, with a $3.6 billion market cap.
• The merger, expected to close in the second half of 2025, will help Independent enter New Hampshire while expanding its footprint into northern Massachusetts. The combined company will have 151 locations.

Dive Insight:

In the deal, Enterprise would merge into Independent, and Enterprise Bank would be folded into Independent’s subsidiary, Rockland Trust.

The merger will give Enterprise shareholders 0.60 shares of Independent common stock and $2 in cash for each share of Enterprise common stock they hold, the banks said.

That’s $45.06 per share, based on the Independent closing price of $71.77 on Friday. Independent intends to issue roughly 7.5 million shares of its common stock and pay nearly $27.1 million in cash in the merger.

This is Independent’s first acquisition since 2021, when it acquired East Boston Savings Bank to deepen its presence in the city.

“Enterprise Bank is the perfect merger partner for Rockland Trust, consistent with all aspects of our outstanding long-term merger track record,” Jeffrey Tengel, CEO of Independent Bank Corp., said in a statement. “In addition to expanding our branch footprint north and into New Hampshire, this acquisition will further enhance our core deposit franchise and provide opportunities for us to introduce our full suite of banking solutions, wealth management services, and comprehensive financial advice to new businesses and households.”

Independent intends to raise $250 million in subordinated debt before closing, the company said.

After the transaction is complete, Chair George Duncan will become an adviser to Independent's board. Meanwhile, Enterprise CEO Steven Larochelle will serve as a consultant for Rockland Trust for one year. Additionally, two Enterprise directors will join Independent's board.

“We are excited to join an organization that lives [similar] values. Our customers will benefit from the additional products, services and technology Rockland Trust offers while continuing to experience the personal relationships they deserve,” Larochelle said in a statement.

There are no plans to close any Enterprise Bank or Rockland Trust branches, a spokesperson for Rockland told Banking Dive via email, adding that Enterprise Bank customers will benefit from 123 branch locations in eastern Massachusetts along with additional technology and product offerings.

“We anticipate that all branch staff will be retained and the retention of other personnel will be a top priority as we work to merge Enterprise Bank into Rockland Trust,” the spokesperson said.

Both companies' boards have unanimously approved the transaction. Enterprise's directors and executives, who own about 20.4% of outstanding shares, have signed voting agreements supporting the merger.

The merger awaits regulatory approvals and the approval of Enterprise shareholders. However, Independent shareholders’ vote is not required, according to the press release.

Enterprise will pay around $22.49 million in termination fees under specific circumstances, according to a Securities and Exchange Commission filing on Monday. 

“The transaction makes sense from a strategic standpoint for INDB, allowing it to further deepen its roots in upper MA and further expand into NH, while providing an attractive balance sheet profile roughly similar to INDB's own, along with a good chunk of wealth AUM,” Christopher O'Connell, analyst at Keefe, Bruyette & Woods, wrote in a research note Monday. 

The merger is projected to increase earnings per share by 16% in 2026 and incur roughly $61.2 million in pre-tax merger-related charges, the banks said.