Zions to Take Over Eldorado Bank

Orange County’s largest independent bank, Eldorado Bancshares Inc., has agreed to be acquired by a major Utah bank, Zions Bancorporation, in a stock swap worth about $190 million, the companies said Thursday.

Under the agreement, shareholders of Laguna Hills-based Eldorado would receive stock worth $13.38 a share, a 55% premium over the stock’s price Thursday.

The deal was announced after the close of U.S. markets. Eldorado’s stock, which has lost about 20% of its value this year, edged down 25 cents a share to $8.63 in Nasdaq trading.

Eldorado operates two bank subsidiaries--Eldorado Bank and Antelope Valley Bank. The holding company would become part of Zions’ subsidiary California Bank & Trust, which operates the Utah institution’s 75 branches in this state.

Eldorado has 16 branches in Southern California and the Sacramento area. Antelope Valley Bank, headquartered in Lancaster, operates eight banking offices that serve Los Angeles, San Bernardino and Kern counties.

Zion has more than 350 branches in eight states and has made several acquisitions in the last few years, particularly in California, where it purchased Sumitomo Bank of California for $546 million in 1998.

The agreement calls for each share of Eldorado to be converted into 0.23 of a share of Zions. The Salt Lake City-based bank’s stock closed at $58.16, off $1.34 a share, in the Nasdaq market.

A majority of Eldorado’s shareholders have approved the deal, the institutions said in a news release. Zion said it expects the merger to reduce some costs, but didn’t elaborate. There was no mention of any branch closures, consolidations or employee layoffs. Officials could not be reached Thursday.

The transaction, which is subject to the approval of banking regulators, is expected to close in the second quarter next year.