The new owners of Bermuda Commercial Bank Ltd. yesterday announced an agreement to buy First Bermuda Group Ltd.

Permanent Investments Ltd. (PIL), which acquired a 54 percent controlling interest in BCB earlier this month, announced the deal yesterday.

The statement said the deal already had the support of the necessary proportion of FGB shareholders.

BCB has 38 staff and FGB around 20 and PIL said yesterday that no redundancies are planned as a result of the deal.

PIL also yesterday published details of its tender offer to BCB shareholders to buy the remainder of the bank's shares.

The offer, which opened yesterday, is for $9.88 per share, and will close at 5 p.m. on May 21.

Shareholders have the choice of accepting the offer or holding onto their BCB shares.

PIL chairman Michael Collier said, pending approval from regulator the Bermuda Monetary Authority, the deal could close by the end of June.

"These two organisations will complement one another," Mr. Collier, who is a PIL nominee to the BCB board of directors, said yesterday.

"FBG's mortgage and savings businesses will fit very nicely with BCB's services and both sets of customers will have a broader range of services to take advantage of."

FBG, based in the Maxwell Roberts Building on Church Street, was established in 1991 and its operating units include First Bermuda Savings & Loan and First Bermuda Securities.

FBG's chairman and chief executive officer Jeff Conyers said there were synergies between the two organisations that would enable the combined company to become a strong competitor in the banking business.

Mr. Conyers added that FGB had represented PIL in the BCB deal and the idea for a merger had evolved from that.

He said FGB's deposits totalled around $200 million and its loan book around $170 million.

BCB chief operating officer Horst Finkbeiner said: "It's one of those occasions when two plus two equals 100. There are sufficient synergies between our operations and theirs for us to work together to provide more services.

"FBG already has a successful mortgage business and if the amalgamation goes through, they will have access to a bigger pool of capital to allow the business to grow."

PIL's takeover of a controlling interest in the bank came after BCB had been stuck in limbo seeking a buyer for nearly four years.

"The pace of change now is very exciting for our staff," Mr. Finkbeiner said.

Mr. Collier said: "The bank has been moving along in first gear for the past three or four years while it looked for a stable buyer. PIL has stepped in. We don't want to go from first gear straight into overdrive. We want to build the bank up the right way."

He said the extra competition generated in the banking sector by having a fourth active bank would be healthy for Bermuda and good for customers.

The deal is expected to be financed through a combination of cash and shares of BCB held by PIL.

The tender offer document, which is available on the BCB website (www.bermuda-bcb.com) and is being mailed out to shareholders, contains more information about PIL's backers.

PIL itself is a Bermuda-based investment holding company that was incorporated in 2006 and was formerly known as Utilico Investments Ltd. Before the BCB deal, it had been dormant since 2008.

Almost half of PIL is owned by two Australian entities. Ingot Capital Management is PIL's major shareholder with a 37.3 percent stake. It has a 15-year track record in global asset management and manages in excess of $1 billion. RESIMAC, also based Down Under, holds a 12.5 percent stake in PIL. It is a non-bank securitisation company with assets in excess of A$4 billion.

Utilico, a Bermuda-based investment company, which owns 14 percent of KeyTech and eight percent of the Ascendant Group, has a 25.1 percent stake in PIL.

The remaining 25.1 percent share of PIL is owned by Eclectic, a UK-based investment company, which also has a number of portfolio investments in listed Bermuda companies.