CIBC has entered into an agreement to acquire PrivateBancorp and its subsidiary, The PrivateBank, a Chicago-based middle market commercial bank with $17.7 billion in assets, complemented by private banking and wealth management capabilities.

The transaction will expand CIBC’s reach in North America, and enable PrivateBancorp to continue building on its record of growth and client service under the leadership of its current management team. The acquisition will create a platform for CIBC to deliver U.S. banking services to its existing Canadian personal and business banking clients, accept deposits in the U.S. and provide commercial and private banking services to the clients of Atlantic Trust, following receipt of required approvals.

Atlantic Trust, a U.S. private wealth management firm was acquired by CIBC in fiscal 2014.

For PrivateBancorp, the transaction will bring added financial strength, the benefits of a larger banking enterprise and deeper wealth management expertise to its clients across the U.S.

CIBC will pay $18.80 in cash and 0.3657 of a CIBC common share for each share of PrivateBancorp common stock. Based on the June 28, 2016 closing price of CIBC’s common shares on the New York Stock Exchange ($77.11), the total transaction value is approximately $3.8 billion or $47.00 of value per share of PrivateBancorp common stock at the time of the announcement.

“Acquiring PrivateBancorp accelerates our strategy of building a strong, innovative and client-focused bank by creating opportunities to bank across borders for our Canadian clients, and offering more services to our private wealth clients at Atlantic Trust,” said Victor G. Dodig, CIBC president and CEO.

Larry Richman, president and CEO of PrivateBancorp, said, “Our team has built a premier commercial and private banking business. We believe this transaction allows us to not only continue our success but to achieve even more as our clients benefit from CIBC’s financial strength, and our employees become part of a respected North American organization that shares our values and is strategically positioned for long-term growth.”

CIBC anticipates completing the transaction during the first calendar quarter of 2017, subject to satisfaction of customary closing conditions, including approval by PrivateBancorp’s shareholders and receipt of regulatory approvals.

PrivateBancorp will remain headquartered in Chicago and retain its Illinois state banking charter. CIBC will continue all of PrivateBancorp’s community investment and charitable programs, and Richman will continue to lead PrivateBancorp’s efforts to support entrepreneurship, provide financial solutions and to serve all of its communities.

J.P. Morgan Securities and CIBC World Markets served as financial advisors to CIBC in this transaction, and J.P. Morgan Securities provided a fairness opinion to the board of directors of CIBC. Goldman Sachs served as exclusive financial advisor to PrivateBancorp, and Sandler O’Neill & Partners provided a fairness opinion to its board of directors. Mayer Brown LLP, Sidley Austin LLP and Torys LLP acted as external counsel to CIBC in connection with the Transaction, while Wachtell, Lipton, Rosen & Katz and Vedder Price acted as external counsel to Private Bancorp.

CIBC is a leading Canadian-based global financial institution with 11 million personal banking and business clients.