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Umpqua Holdings Corporation (NASDAQ:UMPQ), parent company of Umpqua Bank, announced a definitive agreement to purchase California-based Circle Bancorp, parent company of Circle Bank. The agreement provides for cash consideration to the common shareholders of $20.4 million, or $17.75 per share. Including the planned cash redemption of $3.5 million in preferred stock and the value of outstanding options and warrants, the total aggregate deal value is approximately $24.9 million.
Upon completion of the acquisition, all Circle Bank branches will operate under the Umpqua Bank name. The acquisition will add Circle Bank’s Bay Area network of six branches in Corte Madera, Novato, Petaluma, San Francisco, San Rafael and Santa Rosa* to Umpqua Bank’s network of 193 locations in California, Oregon, Washington and Northern Nevada.
“As we’ve announced previously, the Bay area is a strategic growth market for Umpqua Bank, and this partnership is an important first step in our planned expansion in the region,” said Ray Davis, president and CEO of Umpqua Bank. “Circle Bank has a strong commitment to its customers and communities, and we’re pleased to partner with an organization that shares Umpqua’s community bank values and culture.”
In a statement, Kit M. Cole, chairman and CEO of Circle Bancorp, and Kim Kaselionis, CEO of Circle Bank, said, “The combination of Umpqua and Circle Bank will offer customers expanded geographic coverage and access to the variety of products and services of a large bank delivered with the quality customer service and engagement that only a community bank can provide. All of us at Circle Bank are excited by the opportunities for our customers, our communities and our employees.”
The boards of both companies have approved the transaction, which is subject to regulatory approval and approval by the common and preferred shareholders of Circle Bancorp, as well as other customary conditions of closing. Following entry by the companies into the agreement, Shoreline Capital Partners LP, the holder of approximately 99 percent of the outstanding shares of common stock of Circle Bancorp, delivered to Circle Bancorp its agreement to vote in favor of approving the agreement.