CLEVELAND — Citizens Financial Group Inc. will acquire Charter One Financial Inc. in a $10.5 billion cash deal that will make it one of the nation's 10 largest commercial banks, the companies announced Tuesday.
Citizens, a subsidiary of The Royal Bank of Scotland Group, will grow to $128.8 billion in assets, more than 24,000 employees and more than 1,400 branches across 13 states. It will maintain its corporate headquarters in Providence, R.I.
The acquisition adds $43 billion in assets, 616 retail branches, including 160 in-store locations, and 8,400 employees.
The deal extends Citizens beyond New England and the Mid-Atlantic region into the Midwest and Northeast, adding major markets in six new states: Ohio, Michigan, New York, Illinois, Vermont and Indiana. It will also expand Citizens' business in western Massachusetts, Connecticut and Pennsylvania.
"This is a significant transaction for Citizens," Lawrence K. Fish, the company's chairman, president and chief executive, said in a statement. "However, this is not about size as we will continue to be focused locally, providing our legendary service and outstanding products in every market we serve."
The cash purchase price is $44.50 per share. The deal is expected to close in the fourth quarter.
Charter One shares closed Tuesday at $35.95, up 56 cents, on the New York Stock Exchange. After the deal was announced, the shares surged nearly 20 percent to $43.01 in after-hours trading.
The deal allows Charter One to keep its national bank charter and continue operations based in Cleveland.