Columbia Banking to acquire Pacific Premier in a $2 billion deal
April 23 (Reuters) - Columbia Banking System (COLB.O), opens new tab will acquire Pacific Premier Bancorp (PPBI.O), opens new tab in an all-stock deal for about $2 billion, the companies said on Wednesday, adding to the growing consolidation in the industry amid market uncertainty.
U.S. regional bank mergers have seen a notable rise in recent times as lenders are looking to strengthen their balance sheets and to compete better against larger rivals, as the market trudges through President Donald Trump's fluctuating tariff decisions.
Lower consumer confidence due to these tariffs may curb spending and dampen loan demand.
Pacific Premier shareholders will receive 0.9150 shares of Columbia for each stock held, valuing the bank at $20.83 each, representing a 3.6% premium to the closing price on Wednesday.
Following the merger's completion, expected in the second half of 2025, Pacific Premier stockholders will own about 30% of Columbia's outstanding shares of common stock.
"We expect the transaction to have minimal impact on Columbia's capital ratios, and we do not need to raise additional capital to support the deal," Clint Stein, president and CEO of Columbia Banking, said in a conference call.
Shares of Columbia Banking fell 2.2% while those of Pacific Premier rose 5% after the bell.
The acquisition will help Columbia Banking expand its presence in the Western U.S. with over $57 billion in deposits and is projected to deliver mid-teens EPS accretion to the bank.
"This combination truly establishes the leading banking franchise in the Western region," Stein said in a statement.
The combined company will have about $70 billion in assets. Three directors of Pacific Premier, including President and CEO Steve Gardner, will join the Columbia board once the merger is complete.
Piper Sandler & Co acted as the financial adviser to Columbia, and Keefe, Bruyette & Woods, a Stifel company, was Pacific Premier's adviser.
Umpqua Bank, a subsidiary of Columbia Banking System, plans to change its name to Columbia Bank later in the year for brand clarity.
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