United Bankshares of Parkersburg, W.Va., the second-largest bank holding company in the state, is expanding its Virginia operations by acquiring a $61 million-asset bank in Arlington.
The $10.9 million deal, if approved by shareholders and regulators, would give the $1.7 billion-asset company a healthy institution, called First Commercial Bank, to complement its smaller institution in nearby McLean.
"You're supposed to shoot where the ducks fly," said Joseph W. Sowards, executive vice president at United. "There are more ducks in that market."
United's McLean subsidiary, the $30 million-asset Bank First, would be merged into First Commercial. Bank First would become primarily a loan production office, Mr. Sowards said.
First Commercial's chairman and president, James B. Brockett, and his wife, an executive vice president, would retire upon completion of the transaction, expected in the fourth quarter. Both would retain their board positions.
"I am 65, and I've been in this business for 41 years," said Mr. Brockett. "And this is what we wanted to do. We also anticipated that the best way to grow would be to affiliate with a much larger institution."
The Brockett family holds 68% of the stock, which means it would receive $7.4 million from the deal. The transaction is structured as a 50-50 stock and cash deal. First Commercial shareholders would receive 1.12 shares of United stock as well as $26.25 for each share of First Commercial stock. The cash part of the deal is taxable.
That amounts to $54.25 a share, or 190% of First Commercial's book value.
While the senior Brocketts would step down, a son, Charles C., who is the bank's chief financial officer, and his wife, a bank administrator, would stay on board.
Mr. Brockett's 15-year tenure at the bank included some rough spots. In the winter of 1987, First Commercial's minority shareholders unsuccessfully attempted to oust him, charging that his salary - at that time $150,000 - was too high, that he abused his expense account.
