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CIT-Newcourt in $4.2B deal
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March 8, 1999: 8:29 a.m. ET
U.S. finance firm acquiring Canada's biggest nonbank lender in stock swap
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NEW YORK (CNNfn) - CIT Group, one of the biggest finance companies in the United States, said Monday it agreed to buy Newcourt Credit Group, the biggest nonbank lender in Canada, for about $4.2 billion in stock.
The merger will create a finance company based in New Jersey with $50 billion in managed assets, $2.2 billion in sales and $500 million in net earnings, the companies said. CIT, based in New York, has 3,200 employees and Newcourt, with headquarters in Toronto and Parsippany, N.J., has 5,000.
Under the deal, CIT will swap 0.92 of a share of its stock for each outstanding Newcourt common share, the companies said. They expect cost-savings of $150 million from the deal. There was no mention of job cuts in their announcement.
CIT President Albert Gamper Jr. will be chairman and CEO while Newcourt President Steven Hudson will take that post at the new company.
The deal has been approved by the boards of both companies and requires approval by regulators. The companies expect it to close in the third quarter.
Japan's Dai-Ichi Kangyo Bank, CIT's biggest shareholder, will own about 24 percent of the combined company.
CIT stock rose 1-7/16 to 30-3/4 while Newcourt added 13/16 to 25-13/16 on the New York Stock Exchange Friday. 
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