Umpqua shareholders will around 62% and Columbia shareholders nearly 38% of the combined company, upon closing
Umpqua Bank branch in Hillsboro, Oregon. (Credit: Steve Morgan/Wikipedia.)
Columbia Banking System, the holding company of Columbia State Bank is set to merge with the parent organisation of Umpqua Bank, in an all-stock deal worth $5.1bn.
Under the terms of the agreement, Umpqua shareholders are eligible to receive 0.5958 shares of Columbia stock for each Umpqua share held.
The deal was unanimously approved by the boards of directors of both companies.
It is expected to close in mid-2022, subject to certain customary closing conditions, including receipt of regulatory approvals and approvals from shareholders.
Upon closing, Umpqua shareholders are expected to own around 62% and Columbia shareholders nearly 38% of the combined company.
Umpqua president and CEO Cort O’Haver said: “This is an exciting combination that brings together two well-respected organizations and talented teams, accelerating our shared strategic objectives to create the leading regional bank headquartered in the West.
“Together, with increased scale, we’ll have the ability to provide expanded opportunities for associates and serve customers through an even more comprehensive suite of solutions.
“We’ll also be able to strengthen our ongoing investment in our communities and deliver tremendous value for shareholders. I look forward to partnering with the Columbia team to expand our market share as a combined organization.”
Once completed, the combined holding company will operate as the Columbia Banking System, with headquarters in Tacoma, Washington.
With headquarters in the greater Portland metropolitan area, the combined bank will operate under the Umpqua Bank name.
Columbia Trust Company, CB Financial Services and Columbia Private Bank will be its affiliates, under the banner of Columbia Wealth Management, and Financial Pacific Leasing.
The combined company is anticipated to become a large-scale franchise in US West Coast with assets valuing more than $50bn.
It will have $43bn in deposits, including $16bn deposits in Oregon, $15bn in Washington, $10bn in California and $2bn collectively in Idaho and Nevada.
Columbia president and CEO Clint Stein said: “This is a historic partnership that will enhance what both banks are able to do for clients, team members and communities, while driving significant value for our shareholders.
“We believe blending the complementary expertise, services and innovative technology of both banks will position the combined organization as the preferred bank for business and families across the West.”