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Santa Ana’s Banc of California Inc. (NYSE: BANC), the second largest bank headquartered in Orange County, said it will buy Costa Mesa-based Pacific Mercantile Bancorp (Nasdaq: PMBC) in an all-stock transaction valued at $235 million.
After the $9.77 per share offer was announced, Pacific Mercantile shares jumped 24% in after hours trading to $10 each. Before the announcement, they traded at $8.06 and a $192 million market cap. Last March, the shares fell as low as $2.95.
“Pacific Mercantile is a strong strategic fit,” Banc of California Chief Executive Jared Wolff said in a statement. “Its size, business focus, and deposit profile perfectly align with our existing operations, and will accelerate our growth and operating scale in key markets.”
Banc of California shares were unchanged after the announcement. Existing Banc of California stockholders will own approximately 81% of the outstanding shares of the combined company and Pacific Mercantile shareholders are expected to own approximately 19%. The transaction is expected to close in the third quarter.
For more information, read the Business Journal’s print edition on March 29.