Seacoast Commerce Banc Holdings, parent company of Rancho Bernardo-based Seacoast Commerce Bank, has signed an agreement to acquire Capital Bank for $60 million in a cash-and-stock deal.
Capital is an Orange County-based bank with branches in San Juan Capistrano and Encinitas.
The bank’s assets total a bit more than half of Seacoast’s: Capital, founded in 2008, reported $305.2 million in assets at the end of the first quarter; Seacoast, $572 million.
The banks’ board of directors have reportedly OK’d the agreement, which is expected to close in the fourth quarter, subject to closing conditions including regulatory and shareholder approvals.
Seacoast’s primary business is in U.S. Small Business Administration loans.
“While this is a departure from our singular SBA focus, we see significant benefits to what we will be able to do on a combined basis,” said Rick Sanborn, CEO of Seacoast. “Capital is an extraordinarily run bank with pristine credit, strong specializations, an efficient operating platform, and great profitability. We will be even better on a combined basis.”
The agreement would provide Capital shareholders with about $53.6 million, 80 percent in stock and 20 percent in cash. Shareholders with unvested stock options would get an additional $6.4 million in cash.
The acquisition is expected to be marginally accretive to fourth quarter 2017 earnings and 19 percent accretive to 2018 earnings, excluding closing costs.
Two members of Capital’s board of directors are expected to join the company’s board after the acquisition closes.
The bank also announced a private placement of $10 million, which is expected to close prior to the acquisition deal’s finalization.