NewStar Financial has entered into a definitive stock purchase agreement with Dickinson Financial to acquire Southern Commerce Bank.
The purchase price will be based on the tangible book value of the bank on the closing date and is subject to adjustment based on changes in tangible book value and certain tax elections available to the seller.
The closing of this transaction is subject to regulatory approval. NewStar will amend its application with the Federal Reserve Bank of Boston for approval to become a bank holding company and acquire Southern Commerce Bank.
NewStar previously filed applications with the Federal Reserve Bank of Boston, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation for conditional approval of shelf charter to form a de novo national bank with federal deposit insurance and to become a bank holding company. The company expects the transaction to close in the first quarter of 2009, subject to receipt of required regulatory approvals.
Timothy Conway, chairman and CEO of NewStar, said: This acquisition represents an important step in the transformation of NewStar Financial into a bank holding company. Southern Commerce is an attractive platform for NewStar to begin developing a depository franchise in a large market with strong growth potential.
Together with NewStar’s commercial lending franchise, this acquisition strengthens our business model and positions us to capitalise on other opportunities to expand the deposit base and increase our commercial banking activities.
