Shareholders of both Berkshire Hills Bancorp and Legacy Bancorp have approved the proposed merger between the firms in a deal expected to create a $4 billion institution, the companies said in a statement.

The definitive agreement was signed on 21 December 2010, under which one share of Legacy common stock will be exchanged for 0.56385 Berkshire common shares plus $1.30 in cash. Berkshire will also issue about 4.4 million shares, bringing its total shares outstanding to approximately 21.1 million and total market capitalization to around $450 million.

At the Berkshire shareholders' meeting, 99 per cent of the voting shares approved the agreement, representing 79 per cent of total shares outstanding. At Legacy, the 99 per cent that voted in favor of the deal represent 61 per cent.

The combined entity will have more othan 60 offices in Berkshire County, Pioneer Valley, New York, and Southern Vermont. The merger is expected to complete in July 2011, subject to state and federal regulatory approval.