PacWest Bancorp has terminated its previously announced $466.7m acquisition of El Dorado Savings Bank.
The deal was dropped after it failed to receive the support of two-third El Dorado shareholders, a pre-requisite to close the deal under the federal law.
El Dorado chairman Tom Meuser said: “The El Dorado board and I are disappointed that the unexpected recent decline in bank stocks – which significantly reduced the nominal value of the proposed stock and cash transaction – has affected shareholder support at this time.
“El Dorado’s board and management team will work together to map an independent path forward.”
El Dorado Savings Bank acquisition: Background
In September last year, both the companies signed the agreement to merge their businesses through a cash and stock deal.
PacWest and El Dorado are not liable to make any payments to the other due to the termination of the acquisition, as agreed in the original deal.
Established in 1958, El Dorado is a federally chartered savings bank with nearly $2.2bn in assets. It operates 35 branches in northern California and northern Nevada.
PacWest president and CEO Matt Wagner said: “We offer our best wishes to El Dorado and its management.
“We will continue to execute our business plan and work to produce top-tier operating results, and we intend to continue our M&A strategy, which prioritises being a financially disciplined acquirer – a strategy we’ve refined through 29 successful acquisitions over the past 18 years.”
PacWest Bancorp is the holding company Pacific Western Bank with more than $24bn in assets. The bank has 74 full-service branches in California and one in North Carolina.