In its second deal in two months, Glendale Federal Bank said it has agreed to acquire neighboring TransWorld Bank for $63 million in cash, or 1.96 times book value.
TransWorld is a $375 million-asset bank based in nearby Sherman Oaks, Calif.
Glendale's chief executive, Stephen J. Trafton, said the acquisition would enhance business banking.
TransWorld shareholders will receive $18.25 a share. The transaction was done in cash so as not to be dilutive to Glendale's stockholders, analysts said.
Glenfed agreed in late August to buy a Glendale neighbor, $74 million- asset OneCentral Bank, for $11.4 million in cash. The acquisition is expected to close early next year.
The latest deal makes Glenfed more attractive to an out-of-state acquirer, according to analysts.
"Trafton has indicated that he's open to considering all strategic alternatives, but in the meantime he's been taking the bank down the community banking path," said Joseph K. Morford 3d, an analyst at Alex. Brown & Sons Inc.
Richard A. Fink, senior executive vice president in charge of acquisitions at Glendale, said he didn't expect significant cost savings from the deal. The transaction's primary goal was to get TransWorld's small-business expertise and its loan customers, 79% of whom are small businesses, he said.
