City National and Royal Bank of Canada announced a definitive agreement by which Royal Bank of Canada will acquire all outstanding shares of City National. Total consideration is valued at approximately $5.4 billion at announcement, or approximately $93.80 per City National share, comprised of a mix of cash and common stock, based on RBC’s closing stock price on January 21, 2015. The agreement has been approved by the boards of both companies.

In the U.S., RBC already has a top-10 investment bank and the 8th largest wealth management firm. RBC has 8,000 employees in the U.S., including more than 3,000 in New York.

“We’re very enthused about merging with RBC,” said City National Chairman and CEO Russell Goldsmith. “This combination is a compelling opportunity. It will deliver significant value to City National shareholders along with the opportunity to participate in the growth of RBC. It will promote both continuity and growth, enabling our outstanding team of colleagues to maintain and even strengthen City National’s value proposition. It also will enhance what we can do for our clients and the communities we serve. My colleagues and I look forward to joining forces with this company that has tremendous financial strength, considerable resources and capabilities, and values that are very similar to those of City National.”

RBC President and CEO Dave McKay said: “In line with RBC’s strategic goals, we believe this combination creates a powerful expansion platform for focused long-term growth in the country which we view as our second home market. City National serves high-net-worth and commercial client segments in select high-growth markets, and represents a unique opportunity to complement and enhance our existing U.S. businesses and product offering. Like us, City National has a strong commitment to client service and a prudent risk culture. RBC supports City National’s community reinvestment program, and both RBC and City National are committed to making a meaningful, positive difference in the communities they serve. City National also has a strong leadership team and its employees are focused on building deep, long-lasting relationships with their clients.”

Following completion of this transaction, Goldsmith will remain Chairman and CEO of City National, and he also will be responsible for RBC’s U.S. Wealth Management unit. Goldsmith has served as City National’s CEO since 1995, during which time the company’s assets have grown from $3.1 billion to $32.6 billion.

Closing is expected before the end of calendar 2015 subject to customary closing conditions, including receipt of required regulatory approvals and the approval of City National’s stockholders.

Bank of America Merrill Lynch and Sandler O’Neill + Partners served as financial advisors to City National. Wachtell, Lipton, Rosen & Katz served as legal advisor to City National. RBC Capital Markets and J.P. Morgan Securities served as financial advisors, and Sullivan & Cromwell LLP and Osler, Hoskin & Harcourt served as legal advisors to Royal Bank of Canada in this transaction.

To view the full City National news release, click here.