Far West S&L; Tentatively Agrees to Purchase Troubled Progressive

Far West Financial Corp., the Newport Beach-based operator of Far West Savings & Loan Assn., said Tuesday that it has reached a tentative agreement to acquire troubled Progressive Savings & Loan Assn.

Financial details of the deal were not released but a Far West official said the entire purchase price of the 10-branch Progressive would not exceed $15 million, or the equivalent of $3 per share.

At that price, Far West would be paying about twice what two earlier suitors had tentatively agreed to pay for Alhambra-based Progressive last year and about 10 times the institution’s net worth of $1.6 million as of Sept. 30.

Progressive lost a total of $9.4 million in 1984 and 1985.

Far West officials, who had earlier tried to buy some of Progressive’s branch operations, said the purchase price was based to a large degree on the value of those branch offices, which extend throughout Los Angeles County. Far West officials said the deal would not involve any bail-out funds from the Federal Savings and Loan Insurance Corp.

The Far West deal represents the third time in the last six months that Progressive, which has assets of $500 million, has lined up a merger partner. The association has been under federal regulatory orders for the last two years to find additional sources of operating cash.

Raymond Rodino, Progressive’s president, said the two earlier deals fell apart because the parties could not reach a final agreement on the terms. Anaheim developer James A. Carter tentatively agreed last June to pay about $1.50 per share for the association but backed out two months later when a New York investment group offered $1.75 per share.

The investment group, Greenfield Partners, dropped its bid in January, Rodino said, after concluding that the deal had “some onerous conditions.”

Rodino said Progressive attorneys contacted Far West, which has assets of $3 billion, about a potential acquisition because the Newport Beach association had earlier expressed interest in buying some of its branches.

Far West, which operates 25 branches throughout Southern California, said Progressive’s branches will fit neatly into its existing system. Officials doubted whether layoffs among Progressive branch personnel would be necessary.

Completion of the deal is subject to several conditions, including regulatory and stockholder approvals.