Highlights of the Announced Transaction:
- Repositions First Choice as one of the top 20 commercial banks
headquartered in Southern California
- Transformative step up to approximately $1.5 billion in total
assets on a pro forma basis
- Strong and compelling strategic rationale for all stakeholders
- Diversifies and expands First Choice’s presence in Los Angeles
and San Diego Counties
- Compelling economics for First Choice and Pacific Commerce
shareholders – including immediate accretion to earnings, with a
strong tangible book value per share earnback
CERRITOS, Calif.--(BUSINESS WIRE)--
First Choice Bancorp (OTCQX: FCBP) (“First Choice,” “we,” “us” or
“our”), the holding company of First Choice Bank (“First Choice Bank,”
and the “Bank”), and Pacific Commerce Bancorp (OTC Pink: PCBC) (“Pacific
Commerce”), the holding company of Pacific Commerce Bank, today
announced they have entered into a definitive agreement under which
First Choice will acquire Pacific Commerce in an all-stock transaction
valued at approximately $110.4 million, or $11.54 per share, based on a
30-trading day volume weighted average price of $24.83 for First
Choice’s common stock as of February 23, 2018. The Company expects the
transaction to be immediately accretive to earnings per share.
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Pacific Commerce is headquartered in Los Angeles, California, with
$536.1 million in total assets, $425.1 million in gross loans and $464.4
million in total deposits as of December 31, 2017. Pacific Commerce has
six full-service branches in Los Angeles and San Diego Counties,
including its operating division, ProAmérica Bank, in Downtown Los
Angeles. The transaction will increase First Choice’s total assets to
approximately $1.5 billion on a pro forma basis.
Peter Hui, Chairman of First Choice, stated, “We are very pleased to
expand our growing franchise by joining with this esteemed organization.
Joining forces with Pacific Commerce gives us the opportunity to further
serve our existing clientele, while we reach out to a new customer base.
We will be expanding our footprint to the Mexican border. Since First
Choice was founded in 2005, we have been a 'fusion' mix of diverse
cultures. Pacific Commerce shares that fusion vision and we are thrilled
to join our First Choice family with the Pacific Commerce family.”
First Choice President and Chief Executive Officer Robert M. Franko
said, “We are excited about joining forces with a powerful bank like
Pacific Commerce. We welcome all of the Pacific Commerce employees,
customers and shareholders. Expanding our presence in Los Angeles and
San Diego Counties to the Mexican border fits in with our long term
strategic plan. Adding branches in Los Angeles, West Los Angeles, and
San Diego increases our commitment to serving those communities. We have
been impressed by Pacific Commerce’s strong commitment to its
communities, disciplined growth strategies, and success, and we look
forward to growing our Bank together.”
Frank J. Mercardante, Chief Executive Officer of Pacific Commerce,
stated, “We are very pleased to be joining with First Choice and believe
this is an excellent opportunity for our shareholders, customers and
employees to realize enhanced value by being part of a larger financial
institution with considerably deeper resources, operational scale and a
steady stream of core earnings. Our cultures match very well and our
focus on helping the customer, which is unique to community banking, is
core to their strategy. Our customers will benefit with access to many
more products and services, together with significantly increased
lending capacity, enabling us to meet more of the needs of our customers
and our community.”
Transaction Details
Under the agreement, Pacific Commerce common shareholders will be
entitled to receive a fixed ratio of 0.46531 shares of First Choice
common stock, subject to certain adjustment, in this stock-for-stock
transaction. Based on First Choice’s 30-trading day volume weighted
average stock price of $24.83 as of February 23, 2018, the total
aggregate value of the transaction, including the in-the-money value of
PCBC’s stock options, is approximately $110.4 million, or $11.54 per
PCBC common share.
Existing First Choice shareholders will own approximately 63.5% of the
outstanding shares of the combined company and Pacific Commerce
shareholders are expected to own approximately 36.5%.
Pursuant to the terms of the merger agreement, First Choice and Pacific
Commerce shall mutually agree upon four individuals currently serving on
the board of Pacific Commerce to serve on the board of First Choice
following the merger.
The transaction is expected to close early in the third quarter of 2018,
subject to satisfaction of customary closing conditions, including
regulatory approvals and approval of Pacific Commerce’s and First
Choice’s shareholders. Pacific Commerce’s directors and select executive
officers, and First Choice’s directors, have entered into agreements to
vote in favor of the merger with respect to their respective shares of
Pacific Commerce and First Choice common stock.
Hovde Group LLC acted as financial advisor to First Choice in the
transaction and delivered a fairness opinion to the Board of Directors
of First Choice. Loren P. Hansen, APC served as legal counsel to First
Choice. Piper Jaffray & Co. acted as financial advisor to Pacific
Commerce in the transaction and delivered a fairness opinion to the
Board of Directors of Pacific Commerce. Stuart | Moore | Staub served as
legal counsel to Pacific Commerce.
Conference Call and Investor Presentation
First Choice and Pacific Commerce will host a joint conference call at
11:00 a.m. PT / 2:00 p.m. ET on Monday, February 26, 2018 to discuss the
merger announcement. Analysts and investors may participate in the
question-and-answer session. The conference call can be accessed by
telephone at 1+ (888) 317-6016 and asking to join the “First Choice
Bancorp” conference call. Additionally, a telephone replay will be made
available on the Company’s investor relations website.
A presentation to be discussed on the conference call is attached to
this press release and will be made available on the Presentations page
of the Company’s investor relations website.
About First Choice Bancorp
First Choice Bancorp is the registered bank holding company for First
Choice Bank. First Choice Bank, headquartered in Cerritos, California,
is a community-focused financial institution, serving diverse consumers
and commercial clients and specializing in loans to small businesses,
Private Banking clients, Commercial and Industrial (C&I) loans, and
commercial real estate loans with a niche in providing finance for the
hospitality industry. First Choice Bank is a Preferred Small Business
Administration (SBA) Lender. Founded in 2005, First Choice Bank has
quickly become a leading provider of financial services that enable our
customers to grow, maintain strength, and achieve their business
objectives. We strive to surpass our clients’ expectations through our
efficiency and professionalism and are committed to being “First in
Speed, Service, and Solutions.” First Choice Bancorp stock is traded on
the Over the Counter (OTCQX) under the ticker symbol “FCBP”.
First Choice Bank’s website is www.FirstChoiceBankCA.com.
About Pacific Commerce Bancorp
Pacific Commerce Bancorp is the parent company for Pacific Commerce
Bank. Pacific Commerce Bank operates six full-service branches in Los
Angeles and San Diego Counties, including its operating division,
ProAmérica Bank, in Downtown Los Angeles. Pacific Commerce Bank provides
a complete array of deposit, treasury, cash management and loan banking
solutions to small businesses, professionals and high net worth
individuals from Los Angeles to the Mexico border. As a Preferred SBA
Lender, Pacific Commerce Bank provides a full complement of lending
solutions to small businesses throughout Southern California. Pacific
Commerce Bancorp is publicly traded on the Over the Counter Market (OTC
Pink) under the ticker symbol “PCBC”.
For more information please visit the website at www.PacificCommerceBank.com.
FORWARD-LOOKING STATEMENTS
Statements made in this release, other than those concerning historical
financial information, may be considered forward-looking statements,
which speak only as of the date of this release and are based on current
expectations and involve a number of assumptions. These include
statements as to the anticipated benefits of the merger, including
future financial and operating results, cost savings and enhanced
revenues that may be realized from the merger as well as other
statements of expectations regarding the merger and any other statements
regarding future results or expectations. Each of First Choice Bancorp
and Pacific Commerce Bancorp intends such forward-looking statements to
be covered by the safe harbor provisions for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995 and is
including this statement for purposes of these safe harbor provisions.
The companies’ respective abilities to predict results or the actual
effect of future plans or strategies is inherently uncertain. Factors
which could have a material effect on the operations and future
prospects of each of First Choice Bancorp and Pacific Commerce Bancorp
and the resulting company, include but are not limited to: the
businesses of First Choice Bancorp and/or Pacific Commerce Bancorp may
not be integrated successfully or such integration may be more
difficult, time-consuming or costly than expected; expected revenue
synergies and cost savings from the merger may not be fully realized or
realized within the expected time frame; revenues following the merger
may be lower than expected; customer and employee relationships and
business operations may be disrupted by the merger; the ability to
obtain required regulatory and shareholder approvals, and the ability to
complete the merger on the expected timeframe may be more difficult,
time-consuming or costly than expected; changes in interest rates,
general economic conditions, legislative/regulatory changes, monetary
and fiscal policies of the U.S. government, including policies of the
U.S.Treasury and the Board of Governors of the Federal Reserve; the
quality and composition of the loan and securities portfolios; demand
for loan products; deposit flows; competition; demand for financial
services in the companies’ respective market areas; their implementation
of new technologies; their ability to develop and maintain secure and
reliable electronic systems; and accounting principles, policies, and
guidelines, and other risk factors detailed from time to time. First
Choice Bancorp and Pacific Commerce Bancorp undertake no obligation to
update or clarify these forward-looking statements, whether as a result
of new information, future events or otherwise.
Additional Information about the Merger and
Where to Find It
This press release does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of any
vote or approval.
In connection with the proposed transaction, First Choice Bancorp
expects to prepare and file with the Securities and Exchange Commission
a registration statement on Form S-4 containing, among other things, a
joint proxy statement/prospectus and other documents with respect to the
proposed Merger. INVESTORS ARE URGED TO READ THE JOINT PROXY
STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO)
AND OTHER RELEVANT DOCUMENTS PROVIDED BY FIRST CHOICE BANCORP AND
PACIFIC COMMERCE BANCORP IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
Investors may obtain free copies of the joint proxy statement/prospectus
and other relevant documents prepared by First Choice Bancorp and
Pacific Commerce Bancorp (if and when they become available) free of
charge by contacting First Choice Bancorp or Pacific Commerce Bancorp.
View source version on businesswire.com: http://www.businesswire.com/news/home/20180226005501/en/
First Choice
Robert M. Franko, 562.345.9241
President & Chief
Executive Officer
or
Yvonne L. Chen, 562.345.9244
Chief
Financial Officer
or
Pacific Commerce
Frank J.
Mercardante, 213.617.8961
Chief Executive Officer
or
Long
Huynh, 213.787.2804
Chief Financial Officer
Source: First Choice Bancorp