Banknorth agrees to purchase Cape Cod bank

PORTLAND – Banknorth Group Inc. announced Tuesday it has reached an agreement to purchase the parent company of Cape Cod Bank & Trust Co. in an all-stock deal valued at approximately $300 million.

The acquisition of CCBT Financial Companies Inc. is the latest stage of a Massachusetts expansion that Banknorth said was fueled by Bank of America’s pending takeover of FleetBoston Financial Corp.

In Banknorth’s first foray into Massachusetts south of Boston, the company last month announced an agreement to purchase Foxborough Savings Bank for $89.6 million in cash.

Cape Cod Bank & Trust, with $1.4 billion in assets, has 26 branches in Barnstable and Plymouth counties.

“In one transaction, we have become a significant banking and financial services presence in this important Massachusetts market,” said William J. Ryan, Banknorth chairman, president and chief executive officer.

“With the pending purchase of FleetBoston Financial by Bank of America, we want to extend our market presence intelligently in Massachusetts to compete for customers.”

Stephen B. Lawson, CCBT Financial’s present and CEO, cited “the importance of aligning ourselves with a true New England company.”

Under terms of the deal, outstanding shares of CCBT Financial would be converted into 1.084 shares of Banknorth.

The transaction has been approved by the board of directors of both banks and is subject to regulatory approval. The deal is expected to be completed by mid-2004.

Banknorth Group, with $25.7 billion in assets, is a bank holding company whose banking subsidiaries include Peoples Heritage in Maine, Bank of New Hampshire, Banknorth Massachusetts, Banknorth Vermont, Banknorth Connecticut and Evergreen Bank in upstate New York.