Bank of New York has agreed to buy Mellon Financial Corp for $16.5 billion.
Bank of New York stockholders will get 0.9434 of a share, and Mellon stockholders will get one share for each of their shares in the new company, which will be called Bank of New York Mellon Corp.
Following the merger, Bank of New York will own 63 per cent of the combined company and hold 10 of the 18 board seats.
Mellon chief executive Robert Kelly will retain that position at the combined company, while Bank of New York chief executive Thomas Renyi will become executive chairman for 18 months after the closing, which is expected early in the third quarter of 2007.
Combined, the companies will have about $12.5 billion of annual revenue, rank first worldwide with more than $16 trillion of assets under custody, and rank in the top 10 with more than $1.1 trillion of assets under management.
About 3,900 of a combined 40,000 jobs will be cut over three years. The transaction involves about $1.3 billion of restructuring charges.