CVB Financial in Ontario, Calif., and Valley Commerce Bancorp in Visalia, Calif., have amended the terms of their planned merger.
The $8 billion-asset CVB said in a press release Tuesday that it agreed to a pricing collar that guarantees that shareholders of the $416 million-asset Valley will receive consideration between $50.6 million and $62.2 million. The price will be dependent on the average closing price of CVB's common stock prior to closing, subject to adjustment for Valley's merger-related expenses.
CVB said it has the discretion to increase the number of shares issued, or put in more cash, if its average stock price falls below $14 a share before closing. The amendment also allows CVB to terminate the merger if its average closing price falls below $11 a share.
The companies said they still expect the complete the merger, which was announced in September, in the first quarter.
CVB said when it announced the deal that it should generate modest earnings accretion next year. The company projected that it would take about three years to earn back roughly 1% dilution to its tangible book value.