News for Atascadero, CA|Saturday, October 19, 2019
You are here: Home » Business » Rabobank’s U.S. banks sold to Walnut Creek-based community bank

Rabobank’s U.S. banks sold to Walnut Creek-based community bank 

From Businesswire

rabobank atascadero

The Atascadero Rabobank location. Photo from Google maps.

Mechanics Bank and Rabobank, N.A., a subsidiary of Rabobank Group, announced that Mechanics Bank and Rabobank Group have entered into a definitive agreement pursuant to which Mechanics Bank will acquire Rabobank, N.A. in a strategic business combination transaction. The transaction has been approved by each party’s authorizing board of directors.

Mechanics Bank is a 114-year-old full-service community bank based in Walnut Creek, California, with 44 branches throughout California and more than $6 billion in assets. Headquartered in Roseville, California, Rabobank, N.A. is a nationally chartered bank with 100 branches, including one in Paso Robles and in Atascadero, and more than $13 billion in assets. The combined entity would operate under the Mechanics Bank name with 144 branches and in excess of $17 billion in total assets.

In the transaction, Mechanics will acquire Rabobank, N.A.’s retail, business banking, commercial real estate, mortgage, and wealth management businesses. Not included in the transaction are Rabobank, N.A.’s food and agribusiness assets, which with limited exceptions will transfer to Rabobank, N.A.’s affiliate, Rabo AgriFinance located in St Louis, Missouri.

Total consideration for the transaction will be approximately $2.1 billion, subject to customary purchase price adjustments at closing. As part of the total consideration payable in the transaction, Rabobank Group will receive 9.9-percent of the outstanding shares of Mechanics Bank after giving effect to the transaction. Currently, 79-percent of Mechanics Bank’s outstanding shares are owned by Ford Financial Fund II.

“Bringing Rabobank, N.A. together with Mechanics Bank gives us a great opportunity to fill an established gap between the big banks and smaller community banks throughout the state,” said John DeCero, President and CEO of Mechanics Bank. “We are two established institutions with values and principles that align closely. There’s very little geographic overlap and significant potential for value creation for both parties to this combination, and we believe that the new Mechanics Bank will be able to leverage our common strengths at a scale that will benefit all of our clients, our shareholders, and the communities we serve.”

“This is a unique opportunity to merge two high-performing consumer and commercial banks with common values and deep roots in California,” said Mark Borrecco, CEO of Rabobank, N.A. “Both organizations take pride in putting their customers first and possess a strong sense of community.”

Completion of the transaction is subject to customary closing conditions, including the receipt of required regulatory approvals. The transaction is expected to close in the third quarter of 2019. Customers of both banks should continue to do business with their current bankers, and expect little to change as the two organizations prepare to combine.

Lazard Freres & Co. LLC served as financial advisor to Rabobank, N.A., and Sullivan & Cromwell LLP served as legal advisor. Wachtell, Lipton, Rosen & Katz served as legal advisor for Mechanics Bank, and Credit Suisse Securities (USA) LLC served as financial advisor.

Subscribe to the A-Town Daily News for free!




About the author: News Staff

News staff of the A-Town Daily News wrote and edited this article from local contributors and press releases. Scott Brennan is the publisher of this newspaper and founder of Access Publishing. Connect with him on , Twitter, LinkedIn, or follow his blog. He can be reached at scott@accesspublishing.com.

A-Town Daily News on Google
A-Town Daily News | 7343 El Camino Real #235 | Atascadero, CA 93422 | (805) 226-5720