Zions Snatches Amegy Bancorp

It will buy the Texas lender for $1.7 billion of cash and stock.
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Salt Lake City's

Zions Bancorp

(ZION) - Get Report

claimed victory Wednesday in the bidding war for

Amegy

(ABNK)

, the Houston lender whose Texas branches were also coveted by

Compass

(CBSS)

.

The $1.7 billion deal will pay Amegy holders cash and stock worth about $23.32 a share. The shares closed at $22.98 Tuesday amid rumors of a transaction; they traded below $17 as recently as June 15.

At $6.6 billion, Zions' market capitalization is roughly four times that of Amegy. The bank holding company runs about 400 branches in eight Western states. Amegy, meanwhile, operates about 75 branches around Houston and Dallas.

Zions sees the transaction adding to earnings beginning in 2007.