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BMO Financial To Takeover M&I

Vanessa Doctor December 21, 2010

BMO Financial To Takeover M&I

BMO Financial Group is acquiring Marshall & Ilsley.

Marshall & Ilsley has been experiencing losses following the 2008 global crisis, posting a net loss of $483.5 million in the first nine months of 2010 on top of a recorded loss of $599.3 million in the same period in 2009.

Under the terms of the deal, the parent firm of the Bank of Montreal and Harris Bank in Chicago, will acquire all outstanding shares of common stock in the troubled firm in a stock-for-stock transaction. Each outstanding share of M&I will be exchanged for 0.1257 shares of BMO, valuing each share of M&I stock at $7.75, or about $4.1 billion in BMO common shares. The acquired firm's Troubled Asset Relief Program preferred shares are also included in the deal, with full repayment to the US Treasury immediately prior to closing.

"The acquisition is consistent with our strategy to strengthen our North American businesses. It transforms BMO's position in the US Midwest by bringing together highly complementary businesses that align well with BMO's retail, commercial, and asset and wealth management businesses in the country,"Bill Downe, president and chief executive of BMO, said in a statement.

Upon closing, expected by 31 July 2011, current chairman, president and CEO of M&IMark Furlong will become CEO of the combined US personal and commercial banking business, based in Chicago. He reports to Downe and will join BMO's Management Committee.Ellen Costello will become CEO of Harris Financial Corp and US country head for BMO, with governance oversight for all US operations. She also reports to Downe.

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