California Bank of Commerce and Pan Pacific Bank jointly announced the execution of an agreement whereby Pan Pacific Bank will merge into California Bank of Commerce in a transaction valued at approximately $24.3 million.
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The strategic partnership will result in a business bank with more than $620 million in total assets dedicated to serving middle market businesses in the San Francisco Bay Area.
Shareholders of Pan Pacific Bank will receive merger consideration in the form of a combination of approximately one third cash and two thirds CABC common stock, with a per share value of $4.75 to Pan Pacific Bank shareholders based on the last trading price of CABC common stock.
The merger represents a strategic, cultural, and financial fit between two San Francisco Bay Area business banks and bolsters CABC’s South Bay presence.
California Bank of Commerce, headquartered in Lafayette, California, is a state chartered commercial bank with approximately $473 million in assets as of June 30, 2015, and with offices in San Jose, California and Oakland, California.
Pan Pacific Bank, headquartered in Fremont, California, is a state chartered commercial bank with approximately $147 million in assets as of June 30, 2015, and also has one branch located in San Jose, California.
The combined bank will operate as California Bank of Commerce and will continue to create superior, lasting banking relationships with the primary purpose of making our clients more successful.
The boards of directors of both banks approved the transaction, which is subject to customary conditions, including the approvals of bank regulatory agencies and the shareholders of both California Bank of Commerce and Pan Pacific Bank.
The transaction, currently expected to close by year-end 2015 or early in the first quarter of 2016, will result in the existing shareholders of California Bank of Commerce expected to own 79% of the outstanding shares of the combined bank and Pan Pacific shareholders expected to own 21%. ■