Southwest Community Bancorp, based in Carlsbad with $657 million in assets and nine branches, signed a definitive agreement Feb. 16 to be acquired by Sacramento-based Placer Sierra Bancshares in a stock transaction that values the local bank at about $175 million.
Placer, with more than $1.9 billion in assets, agreed to pay $38.97 for each share of Southwest Community stock, which trades on the Nasdaq. The price represents a premium of $3.97, or 11 percent, above Southwest’s closing price on Feb. 15.
Assuming approvals by the shareholders of each company and government regulators, the deal is expected to close by the end of the second quarter.
Placer Sierra is a fast-growing commercial bank with 31 branches in eight Northern California counties and nine branches in Los Angeles and Orange counties.
The acquired Southwest Community branches will continue to operate under the Southwest name. Following the transaction, Southwest Chief Executive Officer Frank Mercardante and Alan Arendsee, a Southwest director, will join the board of Placer Sierra Bancshares.
Since its inception in 1997, Southwest Community has been a fast-growing and profitable institution. Last year, it passed the $600 million mark in assets. Also last year, it reported its seventh straight year of profitability with net income of $10 million, compared with $4.7 million in 2004.
, Mike Allen