Cardinal Financial Corp. (CFNL) has agreed to buy United Financial Banking (UFBC) for nearly $52 million. The two companies are in the northern Virginia suburbs of Washington.
Cardinal, in Tysons Corner, said Monday it would pay $38.26 per share a 107% premium based on United Financial's closing price of $18.50 on Monday.
United Financial, in Vienna, has $331 million of assets and $300 million of deposits. Its banking unit, the Business Bank, has eight branches, all in Virginia.
The $2.9 billion-asset Cardinal has 28 offices in the Washington area.
"We have looked at a number of potential acquisitions in and outside of our current markets and found that [the Business Bank] is an excellent fit," Bernard Clineburg, Cardinal's chairman and chief executive, said in a news release. "With [the Business Bank] we will expand our market share, earnings growth and balance sheet."
Harold Rauner, the chief executive of the Business Bank, would join Cardinal as a regional president.
The deal is expected to close in the first quarter, pending the approval of shareholders and regulators.
United Financial shareholders would receive 1.154 shares of Cardinal common stock plus $19.13 in cash for each of their common shares; the total deal value of $51.7 million excludes stock options and warrants.
Before the deal closes, United Financial would redeem the preferred stock it gave the Treasury Department to participate in the Small Business Lending Fund. Bank officials could not immediately be reached for details about how much preferred stock the Treasury holds. United Financial originally received $5.7 million from the fund, according to the Treasury website.
Raymond James advised Cardinal on the agreement, and Sandler O'Neill advised United Financial.