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PacWest To Buy El Dorado Savings Bank In Deal Valued At About $466.7 Mln

PacWest Bancorp (PACW) has agreed to acquire El Dorado Savings Bank, F.S.B. in a transaction valued at about $466.7 million, the two companies said Wednesday.

Under terms of the deal, El Dorado stockholders will receive 58.2209 shares of PacWest common stock and $427.92 in cash for each share of El Dorado, subject to adjustment in certain circumstances.

Based on PacWest's September 11, 2018 closing price of $50.04, the total value of the merger consideration is $3,341.29 per El Dorado share. The consideration mix would result in a total of about $59.8 million in cash and $406.9 million in PacWest shares.

The companies noted that the transaction is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes and El Dorado stockholders are not expected to recognize gain or loss to the extent of the stock consideration received.

El Dorado, headquartered in Placerville, CA, is a federally chartered savings bank founded in 1958, with about $2.2 billion in assets and 35 branches located primarily in eight Northern California counties and two Northern Nevada counties.

In connection with the transaction, El Dorado will be merged into Pacific Western Bank, the principal operating subsidiary of PacWest Bancorp.

The transaction, which was approved by the PacWest and El Dorado boards of directors, is expected to close in the first quarter of 2019. It is subject to customary closing conditions, including approval by El Dorado's stockholders.

As of June 30, 2018 on a pro forma consolidated basis, the combined company would have about $26.7 billion in assets and 110 branches. No El Dorado branches are expected to be consolidated as a result of the agreement.

PacWest also said it does not expect any El Dorado branches will be closed as a result of the merger.

John Cook, President of El Dorado, will assume the position of Regional President of the Central Valley-Sierra Region of Pacific Western Bank's Community Bank Division upon closing of the merger.

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