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Eastern Bank to acquire Century Bank for $642 million, its biggest deal yet

Century shareholders would see a 26 percent premium based on the cash offer from Eastern

Bob Rivers, CEO of Eastern Bank, poses for a portrait in his office in this 2020 photo. (Blake Nissen/ For The Boston Globe)
Bob Rivers, CEO of Eastern Bank, poses for a portrait in his office in this 2020 photo. (Blake Nissen/ For The Boston Globe)Blake Nissen/The Boston Globe

Eastern Bank has lined up a $642 million deal to acquire Century Bank and Trust, in what would be Eastern’s largest deal in its history and its first bank purchase since becoming a public company in October. The company announced the news in a press release Wednesday night.

It’s this kind of blockbuster acquisition that Eastern chief executive Bob Rivers wanted to make when the company was a mutual bank but found it tough to pull off without the extra capital available as a publicly traded bank.

The deal would combine two of the largest Boston-area community banks and cement Eastern’s position as the third-largest traditional retail bank based in New England after Citizens Bank and Webster Bank. (People’s United sits squarely between those two, in terms of size, but it has recently agreed to be sold to M&T Bank.)

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Century shareholders will get $115.28 in cash for each share of Century Bancorp, the Medford-based bank’s holding company, that they own — a 26 percent premium over Century’s closing price on Wednesday. After the deal closes near the end of the year, assuming shareholder and regulatory approvals, Eastern would convert Century customers to its platform, with Century branches assuming the Eastern Bank name.

Century was founded by Marshall Sloane in 1969 and has been led by his children Barry Sloane and Linda Sloane Kay since their father’s death in 2019.

Boston-based Eastern will fund the purchase price with cash on hand, from a stockpile bolstered by a $1.7 billion injection from its 2020 initial public offering.

With about $16 billion in assets, Eastern is the biggest locally based retail bank in Massachusetts. Century, meanwhile, has $6.4 billion in assets, and is the third largest locally based bank in Greater Boston. Eastern has 110 locations across the eastern part of the state, and in New Hampshire, while Century has 27 branches, largely concentrated in and around Boston.

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Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.