(By Balaseshan) Crescent Financial Bancshares Inc. (NASDAQ:CRFN) has agreed to buy ECB Bancorp Inc. (NYSEAMEX:ECBE) for about $51.6 million or $17.75 a share, a 51.1% premium to ECB's previous closing price.
Under the terms of the merger agreement, shareholders of ECB Bancorp will receive 3.55 shares of CRFN for each share of ECBE common stock. The stock issuance is valued at about $51.6 million in the aggregate, based on 2.905 million shares of ECBE common stock outstanding at $5.00 per CRFN share.
Founded in 1919, ECB Bancorp operates through its banking subsidiary, East Carolina Bank, which has 25 locations and one LPO (loan production office) in eastern North Carolina.
Upon completion of the transaction, the combined company will have about $2.0 billion in total assets, $1.7 billion in total deposits, $1.2 billion in total loans, and a network of 45 branches in North Carolina.
At closing, ECB Bancorp will be merged into Crescent Financial and East Carolina Bank will subsequently operate as VantageSouth Bank.
The merger agreement has been approved by the board of directors of each company. The transaction is expected to close in the first quarter of 2013 and is subject to customary conditions, including regulatory approvals and approval by both companies shareholders.
This is the second merger announcement for Crescent Financial Bancshares in recent months. In August, Crescent and VantageSouth Bank had entered into a definitive merger agreement in which VantageSouth Bank will merge into Crescent State Bank. This transaction is expected to close in the fourth quarter, at which time both banks will operate as VantageSouth Bank.
ECBE is trading 35.23% higher at $15.89 on Tuesday, while CRFN trades down 4.92% at $5.02.