Mechanics Bank, Rabobank Receive Regulatory Approval for Merger
JUL 31, 2019 - 6:45 am
Mechanics Bank and Rabobank received regulatory approval from the Board of Governors of the Federal Reserve, the Office of the Comptroller of Currency, the Federal Deposit Insurance Corporation and the California Department of Business Oversight for Mechanics’ pending acquisition of Rabobank’s California-based and primarily retail bank.
No further regulatory approvals are required for the banks to consummate the acquisition and the other transactions contemplated by the stock purchase agreement. The acquisition is expected to close on or about September 1, 2019, subject to the satisfaction of the remaining conditions set forth in the agreement.
Mechanics concurrently commenced a rights offering to its current shareholders. Pursuant to the rights offering, current shareholders will receive 1.10 subscription rights for each share of common stock owned as of 5:00 p.m., Pacific Time, on July 26, 2019, the record date of the rights offering. Each subscription right will entitle current shareholders to purchase one share of Mechanics common stock at the subscription price of $38,000 per share. Shareholders are not entitled to any over-subscription privilege. Funds received from subscribers in the rights offering will be held by the subscription agent until the rights offering is completed or canceled.
The subscription rights will expire if they are not exercised by 5:00 p.m., Pacific Time, on August 23, 2019. Mechanics reserves the right to extend the expiration date of the rights offering one or more times. The closing of any purchase of common stock pursuant to the subscription rights will occur on August 26, 2019 unless the expiration date is extended, in which case the closing date will be the first business day after the expiration date. All subscriptions received by Mechanics in the rights offering are irrevocable.
In connection with the rights offering and the stock purchase agreement, affiliates of Ford Financial Fund II and Ford Financial Fund III have entered into commitments to acquire approximately 29,395 shares of Mechanics common stock.
Mechanics may cancel the rights offering at any time, and the rights offering is conditioned on the continued satisfaction or waiver of the closing conditions set forth in the stock purchase agreement (other than the condition related to the completion of the rights offering).
Established in 1905, Mechanics Bank is an independent, full-service community bank, based in Walnut Creek, CA. With more than $6 billion in assets, it is the largest bank headquartered in Northern California’s East Bay region, with 43 branch offices throughout California and one in Medford, Oregon.
Headquartered in Roseville, CA, Rabobank is a nationally chartered bank serving California communities grounded in agriculture. Rabobank provides a wide range of financial products and services for individual, business, and food-and-agribusiness customers.
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