Valley National Bancorp in New York has agreed to buy fintech Bluevine in Jersey City, N.J.
The $66 billion-asset Valley said in a press release that it will pay $340 million in cash and stock for Bluevine. The deal is expected to close early next year.
Valley will gain $2.1 billion of low-cost, digitally-sourced deposits when it buys Bluevine. The seller’s engineering, product, data science and AI talent should accelerate Valley’s long-term technology strategy, which includes less reliance on third-party software and service providers.
The deal is expected to be 8% accretive to Valley’s 2028 earnings per share. It should take three years for Valley to earn back an estimated 5% dilution to its tangible book value.
The acquisition “directly advances the strategic priorities we have previously communicated to our shareholders,” Ira Robbins, Valley’s chairman, president and CEO, said in the release. “It is expected to enhance our core funding capabilities, add a proven small business growth platform and meaningfully accelerate our digital and AI capabilities.”
Eyal Lifshitz, Bluevine’s co-founder and CEO, will join Valley as head of small business banking.
Cantor Fitzgerald and Wachtell, Lipton, Rosen & Katz advised Valley. Financial Technology Partners and Sidley Austin advised Bluevine.
Separately, Coastal Financial in Everett, Wash., which is a sponsor bank for Bluevine, disclosed in a regulatory filing that it holds about $447 million of Bluevine’s deposits on its balance sheet. Still, Coastal said is doesn’t expect the fintech’s sale, or any changes to the depository relationship, to have a material adverse effect on its liquidity or funding profile.