On the same day it accomplished its corporate rebranding campaign, the former North Jersey Community Bank took another major step toward expansion by going public late Monday with a $44.8 million initial public offering.
The Englewood Cliffs-based bank, which changed its name to ConnectOne Bank on Monday following a month-long rebranding effort, priced its IPO of 1.6 million shares of common stock at $28 each, the high end of the company’s anticipated $26 and $29 range, according to its amended filing with the U.S. Securities and Exchange Commission.
Those shares opened on the Nasdaq stock market today at $30.50 — up approximately 9 percent from the offer price.
ConnectOne granted underwriters a 30-day option to purchase up to 240,000 additional shares of stock at that price, though without the exercise of that option by the IPO’s expected closing date of Feb. 15, the bank will receive $41.8 million in proceeds from the offering before expenses, while new shareholders will take an approximate 35 percent stake in the bank’s ownership, according to Frank Sorrentino III, ConnectOne chairman and CEO.
Though Sorrentino said the bank completed nine rounds of private capital raises to boost growth since it launched in 2005, he said the company decided to go public this time, in the hopes that having liquid traded securities will attract a stronger work force and increase its chances of acquiring other banks in the future.
“We don’t have anything in our sights immediately, but we believe that over time, based on what you see in the marketplace with the uptick in (mergers and acquisitions), having liquid currency will give us a seat at the table that we didn’t have before in the event that an opportunity comes along,” Sorrentino said.
According to a prospectus filed with the SEC, ConnectOne intends to use net proceeds from the offering “to support growth in the bank’s loan and investment portfolios; to acquire other banks or financial institutions, to the extent such opportunities arise; and for general corporate purposes while maintaining our capital ratios at acceptable levels. A larger capital base will increase our legal lending limit and permit us to make larger loans, and to better penetrate our market areas.”
Those goals align with the bank’s recently executed strategy to take the geographic connotation out of its name and reflect its broader customer base beyond North Jersey, Sorrentino said.
Since local community and business leaders founded the bank at its Englewood Cliffs flagship, ConnectOne has opened seven branches — in Fort Lee, Cliffside Park, Cresskill, Hackensack, West New York, Ridgewood and Holmdel — and expanded its assets from $179.8 million in December 2006 to $883.8 million in September 2012.