A Boston-based bank with assets of $127.1 million and deposits of $106.2 million announced last Wednesday it will be acquired by San Francisco-based UCBH Holdings, the holding company of United Commercial Bank.
Asian American Bank & Trust Co., which has branches in Boston’s Chinatown and Allston neighborhoods as well as Quincy, and UCBH Holdings have signed a definitive agreement in which the California bank will acquire AABT in a transaction valued at approximately $34.3 million.
“The board of Asian American Bank has voted unanimously to approve this transaction,” said Raymond Tung, president and chief executive officer of Asian American Bank & Trust, in a prepared statement. “We are extremely excited about this partnership, as the vast resources of United Commercial Bank will enable us to deliver a broader range of products and higher quality of banking services to our customers in the New England market. The common focus and values that we share between our two institutions will continue to benefit our constituencies in the years ahead.”
UCBH Holdings is the holding company for United Commercial Bank, a state-chartered commercial bank that serves the ethnic Chinese community in California. The bank has 46 California branches located in the San Francisco Bay area, Sacramento, Stockton and Greater Los Angeles; two branches in Greater New York; a branch in Hong Kong; and representative offices in Shenzhen, China, and Taipei, Taiwan.
‘Dynamic Market’
The boards of directors for both banks have approved the agreement. Under the terms of the deal, AABT will be merged into UCBH’s subsidiary United Commercial Bank, for total consideration of approximately $34.3 million (as of the recent closing price for UCBH common stock), comprised of the issuance of UCBH common stock valued at approximately $16.1 million and approximately $18.2 million in cash, subject to certain adjustments detailed in the definitive agreement. The proposed transaction is subject to review if, during the pricing period prior to the closing date, the price of UCBH common shares falls below $14.75 or exceeds $22.12. UCBH has negotiated a retention agreement with Tung.
“The New England market has a large and rapidly growing Asian-American population and is one of the markets we targeted for expansion,” said Thomas S. Wu, chairman, president and chief executive officer of UCBH Holdings, in a statement. “The proposed acquisition of Asian American Bank & Trust Co. reflects our strategic move to enter this dynamic market. The Asian American Bank franchise complements that of United Commercial Bank, and we share similar commitments and values in providing the highest-quality banking services to our customers.”
Although subject to regulatory approval and approval by AABT’s shareholders, the acquisition is expected to close in the first quarter of 2006.
