Banc Of California, PacWest Bancorp To Merge

(RTTNews) - Banc of California Inc. (BANC) and PacWest Bancorp (PACW) agreed to combine in an all-stock merger transaction. Under the terms of the agreement, PacWest will merge into Banc of California, and Banc of California, N.A. will merge into Pacific Western Bank. The combined holding company and bank will operate under the Banc of California name and brand following closing of the transaction.

PACW closed Tuesday's regular trading at $7.69 down $2.85 or 27.04%. But in after-hours trading, the stock gained $2.40 or 31.27%.

As per the terms of the merger agreement, PacWest stockholders will receive 0.6569 of a share of Banc of California common stock for each share of PacWest common stock.

The companies expect to close the merger in late 2023 or early 2024.

Banc of California also announced that it has entered into investment agreements with affiliates of funds managed by Warburg Pincus LLC and certain investment vehicles, managed or advised by Centerbridge Partners, L.P. and its affiliates, which will invest an aggregate of $400 million for newly issued equity securities concurrently with closing of the merger.

Upon completion of the proposed transaction, the shares issued to PacWest stockholders in the merger are expected to represent about 47% of the outstanding shares of the combined company, the shares issued to the Investors in the equity capital raise transaction are expected to represent about 19% of the outstanding shares of the combined company and the shares of Banc of California common stock that are outstanding immediately prior to completion of the merger are expected to represent about 34% of the outstanding shares of the combined company.

Jared Wolff, President and Chief Executive Officer of Banc of California, will retain the same roles at the combined company. John Eggemeyer, who currently serves as the independent Lead Director on the board of PacWest, will become the Chairman of the board of the combined company following the merger.

The board of directors of the combined company will consist of 12 directors: eight from the existing Banc of California board, three from the existing PacWest board and one from the Warburg Investors.