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CAMBRIDGE, Mass. & WELLESLEY, Mass.--(BUSINESS WIRE)--Cambridge Bancorp (Nasdaq: CATC) (the “Company” or “Cambridge”), the holding company for Cambridge Trust Company (“Cambridge Trust”), and Wellesley Massachusetts-based Wellesley Bancorp, Inc. (“Wellesley”), the holding company for Wellesley Bank, are pleased to jointly announce entry into a definitive agreement pursuant to which Wellesley will merge with and into Cambridge in an all-stock transaction. Under the terms of the agreement, each share of Wellesley common stock will be exchanged for 0.580 shares of Cambridge common stock. The transaction is presently valued at $45.54 per Wellesley common share, or approximately $122 million in the aggregate, based upon Cambridge Bancorp’s 10 day average closing price of $78.53 as of December 4, 2019. On a pro forma basis the transaction is expected to be approximately 4.4% accretive to Cambridge’s 2021 earnings per share and approximately 1.6% dilutive to tangible book value per share with an expected earnback period of approximately 2.2 years.

“This strategically compelling merger is expected to enhance and expand Cambridge’s Greater Boston presence with the addition of Wellesley’s six full service banking offices in Norfolk, Middlesex, and Suffolk Counties. Cambridge and Wellesley share similar service-oriented business models and each provide their clients with banking and wealth management services. The combined company will benefit from enhanced scale and an expanded client base, and be well-positioned to capitalize on future growth opportunities. Thomas Fontaine, Chairman, President and CEO of Wellesley, will join the combined company in the role of Chief Banking Officer and Director.

As of September 30, 2019 Wellesley had approximately $986 million of total assets, $833 million of gross loans, $759 million of deposits, and $363 million of wealth management assets. Based on financial metrics as of September 30, 2019, the combined company is expected to have over $3.8 billion in assets, $3.0 billion in gross loans, $3.2 billion in deposits, and $3.6 billion of wealth management assets upon completion of the transaction.

Denis Sheahan, CEO of Cambridge Trust, commented, “We are pleased to announce the strategic combination of Cambridge Trust and Wellesley Bank, who are both dedicated to providing individuals, families, and businesses with exceptional personal attention and custom financial solutions.” Sheahan added, “Wellesley Bank is a well-managed, financially strong and growing company located in attractive markets. The combination strengthens the position of Cambridge Trust in Greater Boston and is a logical extension of our market. We look forward to welcoming the talented Wellesley Bank team to Cambridge Trust.”

“We are excited about the opportunity to partner with Cambridge Trust,” said Thomas J. Fontaine, President and CEO of Wellesley Bank. “Cambridge Trust, much like Wellesley Bank, has a genuine commitment to its clients and the community. Together, we’ll build a premier private banking and wealth management company in Greater Boston and Southern New Hampshire.”

The transaction has been approved by the Boards of Directors of both companies and is expected to be completed during the second quarter of 2020, subject to regulatory approval, approval by Cambridge and Wellesley shareholders, and other customary closing conditions. Upon closing, three Wellesley directors will join the Board of Directors of Cambridge, including Mr. Fontaine.

A presentation with additional information regarding the merger can be accessed by visiting the Cambridge Bancorp investor relations site at “ir.cambridgetrust.com”. Keefe, Bruyette & Woods, Inc. served as financial advisor and provided a fairness opinion to Cambridge Bancorp and Hogan Lovells US LLP served as its legal counsel. Sandler O'Neill + Partners, L.P. served as financial advisor and provided a fairness opinion to Wellesley and Kilpatrick Townsend & Stockton LLP served as its legal counsel.