TD Bank to Buy 51% of Banknorth

TD Bank Financial Group, Toronto, has agreed to become the majority shareholder in Banknorth Group, Portland, Maine.TD Bank Financial will acquire 51% of the outstanding shares of Banknorth in a deal valued at $3.8 billion (just under C$5 billion). Banknorth shareholders will receive $12.24 in cash, 0.2351 shares of TD Bank, and 0.49 shares of "new" Banknorth stock for each share of Banknorth stock. There are options that would permit TD Bank to acquire two-thirds of Banknorth's stock. "This strategic acquisition provides us with an expanding beachhead in the Northeastern United States and an outstanding personal and commercial banking complement to our strong U.S. wealth management franchise," said Ed Clark, president and chief executive of TD Bank. Banknorth, according to the 2004 Mortgage Industry Directory, finished 2003 with $3 billion in loan originations and ranked 112th for the year. As of Dec. 31, 2003, it had a servicing portfolio of $2.7 billion, making it the 113th-largest servicer in the industry. TD Bank is the parent of TD Canada Trust, a depository and mortgage lender north of the border.