Business & Tech

Puyallup's Valley Bank Sold to Heritage Financial Corporation

The Olympia-based company acquired Valley Community Bancshares, Inc. on Tuesday. The combined company will have approximately $1.6 billion in assets.

On Tuesday, Heritage Financial Corporation, the parent company of Puyallup’s Heritage Bank, announced the agreement to acquire Valley Community Bancshares, Inc., which is the holding company for Valley Bank.

The combined company will have approximately $1.6 billion in assets with enhanced market share in the Puget Sound region, according to its press release.

There are six Valley Bank locations in Puyallup.

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"We are very pleased that Valley Bank has agreed to be part of the Heritage Bank team," said Brian Vance, President and Chief Executive Officer of Heritage Financial Corporation. "Both of our franchises have well-established community bank cultures with excellent customer service, community involvement and strong credit disciplines."

The board of directors of Olympia-based Heritage Financial Corporation and Valley Community Bancshares, Inc. unanimously approved the transaction, which is subject to approval by Valley's shareholders, as well as regulatory approvals and other customary closing conditions. 

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Upon closing of the transaction, which is anticipated to take place in the third quarter of 2013, Valley Bank will be merged into Heritage Bank.

The purchase price will be paid 50 percent in cash and 50 percent in Heritage common stock.  As a result, Valley's shareholders will be entitled to receive approximately $19.50 in cash and 1.3611 shares of Heritage's common stock per share. 

Using a 30-day average price per share of Heritage stock for a period ending March 1, 2013 results in a Heritage stock price of $14.327, which when multiplied by the fixed exchange ratio of 1.3611 provides an initial valuation of $39.00 per share or approximately $44.2 million

CEO of Valley, David Brown, has been nominated by the Valley board to serve on Heritage's board.  


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