It has been a topsy-turvy 12 months for ECB Bancorp in Engelhard, N.C., though the company's decision to sell may provide it with more stability.
Crescent Financial (CRFN) in Raleigh, N.C., announced on Tuesday that it would buy the $917 million-asset ECB (ECBE) for $51.6 million in stock. At $17.75 a share, the deal is priced at 77% of tangible book value. ECB shareholders would receive 3.55 shares of Crescent stock.
Last year, ECB reached an agreement with several private equity firms to raise $80 million, but the effort was called off in February when one of the investors could not get regulatory approval. ECB had planned to use at least some of the capital to buy several North Carolina branches from Hampton Roads Bankshares (HMPR) in Norfolk, Va. The branch deal eventually fell through.
Then, in June, the Gibbs family, which owns 13% of the company, called for the company to replace Dwight Utz, ECB's president and chief executive.
Crescent is backed by private equity. Its majority owner is Piedmont Community Bank Holdings, also in Raleigh, which was formed in 2009 and backed by Stone Point Capital in Greenwich, Conn., and Lightyear Capital in New York.
Last month, the $826 million-asset Crescent agreed to merge its Crescent State Bank with the $257 million-asset VantageSouth Bank, which Piedmont Community also owns. That merger is expected to close in the fourth quarter, with VantageSouth serving as the continuing bank. ECB's East Carolina Bank would be merged into VantageSouth.
The ECB deal is expected to close in the first quarter, creating a company with $2 billion in assets, $1.7 billion in deposits and 45 branches in North Carolina.
"This merger will allow the combined company to be the leading community bank from Raleigh" and markets in eastern North Carolina, Scott Custer, Crescent Financial's president and chief executive, said in a press release. Custer, a former CEO of Royal Bank of Canada's RBC Bank, also leads Piedmont Community.