Fairstone Bank will acquire Laurentian Bank for $1.9 billion, and National Bank will take over its retail and small-business banking operations, the financial institutions announced Tuesday.

After the proposed deals close, Laurentian’s 57 retail locations in Quebec will be shuttered. Its approximately 2,700 employees will not be transferred, but they will have a chance to apply for open positions at National Bank.

“We view Quebec as a key market and are excited to continue building our presence with the expertise we’re acquiring from Laurentian Bank,” said Fairstone CEO Scott Wood.

Laurentian will retain its name and head office in Montreal under the new ownership and focus on commercial real estate lending, inventory and equipment financing, intermediary services and capital markets activities.

Fairstone is slated to acquire Laurentian’s business for $40.50 per share with cash and cash equivalents. The acquisition of the business is subject to the closing of the retail/SME segment sale to National Bank.

“This announcement is aligned with the acceleration of Laurentian Bank’s commercial specializations, as announced in our 2024 Strategic Plan,” said Éric Provost, president and CEO of Laurentian. “Joining forces with Fairstone Bank will allow us to grow our specialized commercial business even further, while maintaining our brand identity and head office in Montreal, where we were founded over 175 years ago.”

Laurentian’s common and outstanding shares will be delisted from the Toronto Stock Exchange once all aspects of the proposed transaction are completed. But Laurentian’s preferred shares and notes will continue to be traded publicly.

La Caisse, which own 8% of Laurentian, has agreed to vote in favour of the deal, which is subject to two-thirds of shareholder support.