Zions Bancorp. is selling 2.4 million shares of common stock to help finance its purchase of Sumitomo Bank of California, according to documents filed with the Securities and Exchange Commission.
Based upon Zions' Tuesday morning stock price of $52.0625, the sale would raise about $125 million. Zions said it would purchase the San Francisco-based unit of Japan's Sumitomo Bank Ltd. for $546 million.
Under the merger agreement, Sumitomo's parent, which owns about 85% of the California unit's stock, would receive $32.36 a share; other shareholders would receive $38.25 per share.
The sale would increase Zions' outstanding common shares by about 3.8%, to 66 million, according to the documents. The new shares would count toward the $10 billion-asset company's Tier 1 capital.