East West Bancorp, based in Pasadena and with $23 billion in assets, agreed to purchase MetroCorp Bancshares Inc., parent of San Diego-based Metro United Bank and a Texas bank, for an aggregate $273 million in cash and stock.
MetroCorp operates 18 branches through its Metro United Bank here, and MetroBank in Houston. Metro United has six branches including one in San Diego. Both banking companies were started by Chinese-Americans and primarily serve that population.
As of June 30, MetroCorp had about $1.6 billion in assets and total loans of $1.2 billion.
East West Bank, with a single office in San Diego, said the acquisition will increase its presence in the Texas market.
MetroCorp CEO George Lee agreed to join East West as a senior adviser and chairman of its Texas Strategic Markets Advisory Council.
Under the terms of the agreement, East West is acquiring the outstanding shares of MetroCorp for the lesser of $14.60 per share and 1.72 times the per share tangible equity of the bank. Shareholders of MetroCorp will receive two thirds of the merger payment in East West common stock and the remaining third in cash, the companies said.
The deal, unanimously approved by both boards of directors of the companies, requires approval of MetroCorp shareholders, and customary regulatory agencies. It’s expected to close in the first quarter of 2014, although delays may occur, the companies said.
— Mike Allen