Shares of Danvers Bancorp Inc. soared 28 percent in premarket trading Friday, a day after People’s United Financial said it was buying the bank for $493 million, a price one analyst called "hefty."

Bridgeport, Conn.-based People’s United said in a statement after the market closed Thursday that the purchase of parent company Danversbank will be made in a 55 percent stock and 45 percent cash transaction. Danvers Bancorp shareholders can choose to receive either $23 in cash or 1.624 shares of People’s United Financial stock for each Danvers Bancorp share.

Sterne Agee analyst Matthew Kelley said in a research note Friday that People’s United paid a steep price for "this attractive franchise."

The transaction is subject to regulatory approval and the approval of Danvers Bancorp’s shareholders. The deal has been approved by both companies’ boards of directors.

The deal is expected to close in the second quarter.

The stock of the Danvers, Mass., bank jumped $4.75 to $21.77. (AP)