OceanFirst to buy Flushing, raise $225M from Warburg Pincus

Core Viewpoint - OceanFirst Financial Corp. has agreed to acquire Flushing Financial for $579 million, marking one of the last bank deals of 2025, with the transaction expected to close in Q2 2026 [1][9]. Group 1: Deal Structure and Financials - The merger will create a regional entity with $23 billion in assets and 71 branches across New Jersey, New York, and Philadelphia [2][9]. - OceanFirst's common stock will represent approximately 58% of the merged company, while Flushing stockholders will hold about 30%, and shares issued to Warburg Pincus will account for around 12% [2][9]. - The transaction is projected to result in a tangible book value dilution of about 6%, which is expected to be recovered in roughly three years, with an anticipated earnings per share accretion of about 16% and an internal rate of return of about 24% in 2024 [8]. Group 2: Strategic Rationale and Market Context - The merger is seen as a natural extension of OceanFirst's growth strategy, combining Flushing's presence in Long Island and New York City with OceanFirst's business model [6]. - The past year has witnessed a resurgence in bank consolidation, particularly among small regional and community institutions, with over 170 deals valued at more than $47 billion in 2025 [12]. Group 3: Management and Governance - Upon regulatory and shareholder approval, OceanFirst CEO Christopher Maher will become the chief executive, while Flushing CEO John Buran will serve as non-executive board chairman, with a board comprising 17 directors [10]. - Warburg Pincus will invest $225 million in the combined company, securing a board seat and a 12% ownership stake [9][11].