Eldorado Bancshares of Laguna Hills, Calif., said it has reached a definitive agreement to buy Antelope Valley Bank of Lancaster, Calif., for about $40 million in stock.
Eldorado said it would exchange 3.625 shares for each share of Antelope. The deal, announced Thursday, is expected to close early next year.
Shareholder and regulatory approvals are required. The merger would be accounted for as a pooling of interests.
Antelope Valley Bank, established in 1981, has $200 million of assets and eight branches in the Los Angeles area. It is expected to retain its name, employees, and board.
Eldorado has $1 billion of assets and 17 branches stretching from San Diego to Sacramento. It plans to raise $40 million through a public offering this year.