HomeStreet Inc (NASDAQ:HMST) has entered into a definitive deal under which it will buy Orange County Business Bank NA (OTCMKTS:OCBB), a California banking entity. The proposed deal received approval from companies’ boards and is expected to complete in the fourth quarter of this year or early in 1Q2016, subject to customary closing conditions mentioned in the merger deal, including OCBB shareholder and federal and state regulatory approvals.
Under the terms of the deal, HomeStreet will purchase Orange County in a deal valued at $55.3 million in cash and common stock. The merger deal gives space for an adjustment to the count of shares of HMST stock issuable in the deal if its average closing stock price, as computed during a 10-day trading day period completing on and not including the fifth day preceding the closing date, comes outside the defined range of 90% to 115% of the average closing price computed during such a period before the signing date.
Orange County serves different businesses throughout the California with a client-service focus and commitment to the local business community. This deal offers the bank with significant additional resources to serve customers, including broader menu of consumer and commercial loan, deposit, higher loan limits, insurance and investment services and products.
The experts speak
JP Gough, the CEO and Chairman of Orange County, said that HomeStreet feels like Orange County at a $5 billion size. He is highly impressed by the resemblance in the way both the entities think and the competence of people the banks employ. Mark K. Mason, the CEO of HomeStreet, said that Orange County brings to company a dedicated and talented team of bankers who are acquainted with the different needs of businesses.
In last trading session, the stock price of Orange County gained more than 11% to close the trading session at $11.00. The gains came at a share volume of 173,270 compared to monthly average share volume of 739.
Orange County Business Bank NA (OTCMKTS:OCBB) enjoyed a huge intraday rise yesterday as it finished the last trading session with a gain of 22.22%. The volume surged to 173,000, a huge spike when compared to the daily average of 12,000. The stock has been making a sideways base for the last few months, much required before it could make a jump like this. The base took the form of the well known bullish pattern of Inverse Head & Shoulders and the break above the neckline was the signal. The magnitude of the current rally from the neckline is exactly equal to the previous one.