Strategic acquisition will result in a commercial bank with $2.0 billion in assets
Southern California Bancorp (OTC Pink: BCAL), the holding company for Bank of Southern California, N.A. (the “Bank”), and Bank of Santa Clarita (OTC: BSCA) jointly announce the signing of a definitive merger agreement pursuant to which Southern California Bancorp will acquire Bank of Santa Clarita through the merger of Bank of Santa Clarita with and into Bank of Southern California. Based on financial results as of December 31, 2020, the combined company will have pro forma total assets of approximately $2.0 billion, deposits of $1.5 billion and net loans of $1.5 billion.
“The acquisition of Bank of Santa Clarita marks an important step in our strategy to grow our commercial banking model by expanding the Bank’s footprint north of Los Angeles to the attractive banking communities of the Santa Clarita area,” said David Rainer, Executive Chairman of Southern California Bancorp and Bank of Southern California. “On behalf of our Board, I extend a warm welcome to Bank of Santa Clarita Chairman and Chief Executive Officer Frank Di Tomaso, who will be joining us as a director and providing us additional capabilities as an employee specializing in client relations and marketing.”
“The cultures, values and relationship-based banking models of these two banks are in close alignment and we are very pleased to have the Bank of Santa Clarita team and their customers join the Bank of Southern California family,” said Nathan Rogge, President and Chief Executive Officer of Bank of Southern California. “We have recently added several experienced bankers in the northern area of our footprint, and this expansion will support those teams, as well as increase the Bank’s lending limit. Using reasonable transaction assumptions, and after conducting detailed due diligence, we expect an earn back on the acquisition of less than one year, with earnings modestly accretive this year and in the high single digits in 2022, the first full year of our combined operations. We believe this transaction supports our long-term growth strategy and will unlock shareholder value for both parties.”
“On behalf of our Board of Directors, I am pleased to announce our merger into Bank of Southern California,” said Frank Di Tomaso, Chairman and Chief Executive Officer of Bank of Santa Clarita. “We share with them a banking culture focused on providing high-touch, personalized service to small and middle-market businesses, with a deep commitment to the markets and communities we serve. We believe this strategic partnership, with a shared vision of providing relationship-based banking to the middle-market, will benefit our shareholders, customers, employees, and communities. We will continue to focus on maintaining and creating strong relationships and bringing value to the customers we serve.”
Pursuant to the merger agreement, Bank of Santa Clarita shareholders will receive 1.00 share of Southern California Bancorp common stock in exchange for each share of Bank of Santa Clarita. The 100% stock transaction is valued at approximately $56.2 million in aggregate, based on a per share value of Southern California Bancorp’s stock of $14.15. The value of the merger consideration will fluctuate based on Southern California Bancorp’s stock price. Giving effect to the transaction, existing shareholders of Southern California Bancorp are expected to own approximately 78.0% of the outstanding shares of the combined company and Bank of Santa Clarita shareholders are expected to own approximately 22.0%. Bank of Santa Clarita Chairman and Chief Executive Officer Frank Di Tomaso will join the Board of Directors of Southern California Bancorp and Bank of Southern California.
Source: Company Press Release