Community West Bank agrees to $100M merger
Goleta-based Community West Bank is expanding its operations after the organization announced it would be merging with Central Valley Community Bank with the signing of an all-stock merger agreement on Oct. 10.
The deal, which is expected to close in the second quarter of 2024, is valued at $99.4 million based on Central Valley Community Bank’s stock price at market close Tuesday.
Upon closing, the combined company would have approximately $3.6 billion of assets.
Shares of Community West Bank closed at $12.18 on Oct. 12.
Existing Central Valley shareholders would own about 63% of the outstanding shares following the merger and Community West Bancshares shareholders would own the rest, according to the company.
Under the terms of the agreement, Community West Bancshares shareholders will be entitled to receive 0.79 shares of Central Valley Community Bancorp common stock for each share of Community West Bancshares common stock.
Moreover, under terms of the agreement, Central Valley Community Bank will adopt the Community West brand and trade under the ticker “CWBC” upon closing of the deal.
In a note to investors, Raymond James analysts said the changing of the ticker symbol for Central Valley Community Bank is “appropriate as CVCY expands its presence in California.”
The combined bank will also not be closing any of its branches. Currently, Community West Bank has seven offices across Santa Barbara, Ventura and San Luis Obispo counties and will combine with Central Valley Community Bank’s 20 branches across eight counties around Fresno and the Greater Sacramento area.
According to the press release, James J. Kim, president and CEO of Central Valley Community Bank, will lead the combined bank’s team of executives and professional bankers as CEO.
Martin E. Plourd, CEO and director of Community West Bank, will serve as president and director of the combined company, according to the press release.
Daniel J. Doyle, Central Valley Community Bancorp board chairman, will chair the combined company, according to the press release.
“Combining forces with Central Valley Community Bank is the next logical step in our growth strategy, particularly as both banks share so many fundamental values and practices. Both are equally committed to our communities, clients and employees, and both have fostered the same essential corporate culture focused on client advocacy by professional bankers and a legacy of deeply rooted stability,” Plourd said in a press release.
“By operating as a single, united company, I believe the new Community West Bank will bring unprecedented value to the stakeholders of both companies, who will benefit from the strengthened leadership, enhanced products and services, and an expanded branch network that will give the bank tremendous visibility throughout Central California, from the Sierra Nevada to the sea.”
Central Valley Community Bancorp received financial advisory services and a fairness opinion from Janney Montgomery Scott LLC, and Buchalter, a professional corporation, served as legal counsel.
Community West Bancshares received financial advisory services and a fairness opinion from Piper Sandler & Co., and Husch Blackwell LLP served as legal counsel.