Heritage Commerce Corp (HBC), the parent company of Heritage Bank of Commerce (HBC), has signed an agreement to acquire Presidio Bank in an all-stock transaction valued around $200.3m.
Under the terms of the agreement, Presidio shareholders will receive 2.470 shares of Heritage common stock against each Presidio share.
Additionally, three Presidio board members will join the board of directors of Heritage and HBC.
Presidio Bank acquisition
Once complete, Presidio will merge with and into Heritage Bank of Commerce. The merger will increase Heritage’s total assets to nearly $4bn on a pro forma basis. The number of branches will also increase to 17 in the San Francisco Bay Area, following branch consolidation.
Heritage president and CEO Walter Kaczmarek said: “Presidio Bank is a perfect fit for Heritage, as both of our values are aligned with fostering client relationships.
“The combination of our two high quality banking organisations provides the ability to create revenue and cost synergies while offering Presidio’s client base a broader product offering, increased lending limits, and an expanded branch delivery system that now surrounds the San Francisco Bay Area.”
Headquartered in San Francisco, Presidio provides banking services to small and mid-size businesses. It had around $906m in total assets, as of 31 March 2019.
Presidio Bank chairman and founder Jim Woolwine said: “We believe this transaction represents the best path toward long-term value creation for our shareholders.
“Our clients and employees will benefit from becoming part of a larger banking franchise with an expanded range of products and services throughout the San Francisco Bay Area.”
Subject to shareholders and regulatory approvals, the Presidio Bank acquisition is expected to close in the fourth quarter of 2019.