Eldorado Bank to Be Acquired for $90 Million
The ongoing consolidation of Orange County’s independent banks continued Tuesday as Commerce Security Bancorp Inc. agreed to acquire Eldorado Bancorp in a deal valued at about $90 million.
The deal, which was announced after the stock market closed, values Eldorado at $23 per share. Eldorado’s stock traded Tuesday at $20.375 on the American Stock Exchange.
For the record:
12:00 a.m. Dec. 27, 1996 For the Record
Los Angeles Times Friday December 27, 1996 Orange County Edition Business Part D Page 6 Financial Desk 2 inches; 44 words Type of Material: Correction
Bank deal--A story Wednesday on Commerce Security Bancorp Inc.’s agreement to acquire Eldorado Bancorp incorrectly attributed comments on Eldorado’s future staffing to J.B. Crowell, president and chief executive officer of Eldorado. The comments were made by Eldorado Chief Financial Officer David R. Brown.
The transaction, which must be approved by shareholders and regulators, would blend two institutions “that complement each other,” said Robert P. Keller, Commerce Security chairman. “I don’t think there’s any question that this deal benefits both Eldorado and us.”
Commerce Security would become the largest bank holding company in Orange County, with assets of $850 million.
The deal is the latest in a string of mergers and acquisitions that has trimmed the number of independent banks in Orange County to about a dozen from nearly 50 in 1980.
Keller said it’s too early to determine if there will be layoffs, but he said that the two banks overlap only in Huntington Beach, where both have branches. J.B. Crowell, president and chief executive of Eldorado, said Tuesday that he was uncertain about his future at the bank after the deal is completed.
Commerce Security Bancorp, with headquarters in Huntington Beach, already owns three California banks: Liberty National in Huntington Beach, San Dieguito National in Encinitas and Commerce Security in Sacramento. Those banks have a combined $440 million in assets.
Tustin-based Eldorado Bancorp, which recently celebrated its 25th anniversary, has 12 branches in Orange County. With assets of $390 million, Eldorado offers loan and deposit services for businesses, professionals and individuals.
The cash deal has been approved by members of Eldorado’s board of directors, who own 19% of Eldorado’s stock. Bank executives expect to close the deal during the second quarter of 1997.
Keller raised eyebrows this year when he raised $647 million in just six days during an ill-fated attempt at buying 61 bank branches that Wells Fargo agreed to sell to gain regulatory approval for its purchase of First Interstate Bank.
Keller lost the bidding war to Home Savings of America, but banking industry observers were impressed with his ability to muster such strong financial support. Said one longtime banking executive at the time: “It’s the most money I’ve seen raised for a bank purchase in a one-week period.”
