Park Financial Group in Minneapolis is buying a minority stake in Mesaba Bancshares in Grand Rapids, Minn., that could eventually lead to an outright acquisition.
Park, the parent company for the $58 million-asset Park State Bank, said in a press release Monday that it agreed to buy stock from one of the $675 million-asset Mesaba’s founding investors. Park did not disclose the identity of the shareholder or how much stock it would buy.
The transaction is expected to close in the fourth quarter and will allow Park to put representatives on Mesaba’s board.
Park Financial recently acquired Pioneer National Bank in Duluth, Minn., while Mesaba is the holding company for American Bank of the North and Lake Bank.
“This partnership further confirms our commitment to Duluth and the communities of northeastern Minnesota, while strengthening our ability to compete in the Twin Cities,” David Saber, Park’s chairman and CEO, said in the release. The investment “is a long-term natural extension of our franchise in those markets.”
“This is an exciting development for our banks, our customers and the communities we serve,” Chuck Gesme, Mesaba’s founder, said in the release. “Joining forces with Park … will allow us to be even more competitive in the marketplace, continue to grow in northern Minnesota and further expand our Twin Cities presence.”