Greater Bay Bancorp and Bay Area Bancshares Announce Merger.PALO ALTO Palo Alto, city, California Palo Alto (păl`ō ăl`tō), city (1990 pop. 55,900), Santa Clara co., W Calif.; inc. 1894. Although primarily residential, Palo Alto has aerospace, electronics, and advanced research industries. , Calif.--(BUSINESS WIRE)--Jan. 26, 1999--Greater Bay Bancorp (Nasdaq:GBBK), Palo Alto, and Bay Area Bancshares (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB:BYAR), Redwood City Redwood City, city (1990 pop. 66,072), seat of San Mateo co., W Calif., on San Francisco Bay; inc. 1868. Manufactures include commmunications, electrical, electronic, and medical equipment. , Calif., announced today the signing of a definitive agreement for a merger of the two companies. Following the transaction, Bay Area Bank, a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Bay Area Bancshares, will operate as a wholly owned subsidiary of Greater Bay Bancorp, along with Greater Bay Bancorp's other bank subsidiaries, Cupertino National Bank, Mid-Peninsula Bank, Peninsula Bank of Commerce and Golden Gate Bank. The combined company will have total assets of approximately $1.8 billion and equity of approximately $107 million. The terms of the agreement provide for the Bay Area Bancshares shareholders to receive shares of Greater Bay Bancorp stock in a tax-free exchange tax-free exchange An exchange of assets between taxpayers in which any gain or loss is not recognized in the period during which the exchange takes place. Rather, taxpayers are required to adjust the basis of assets exchanged. for their shares of Bay Area Bancshares. For each outstanding share of Bay Area Bancshares, Greater Bay Bancorp will issue 1.38682 shares if the average closing price of its stock is $30.00 or more, or 1.44271 shares if the average closing price of its stock is less than $30.00 upon completion of the merger. Following the merger, the shareholders of Bay Area Bancshares will own approximately 12.7% of the combined company, after giving effect to all outstanding options. The merger is expected to be accretive to Greater Bay Bancorp's earnings in 1999 based on reductions in operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and revenue enhancements resulting from an expanded product line and increased lending capacity that can be utilized at Bay Area Bank. Management of the organizations believe that significant opportunities exist to enhance the spectrum of financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. offered to both existing and future clients of Bay Area Bank while also increasing market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" in the San Francisco Peninsula The San Francisco Peninsula in California separates the San Francisco Bay from the Pacific Ocean. On its northern tip is the city of San Francisco. On its southern end is part of Santa Clara County, including the cities of Palo Alto, Los Altos, and Mountain View. market areas. Greater Bay Bancorp's Board of Directors will be expanded to 15 members with the addition of one current director of Bay Area Bancshares. The Board of Directors of Bay Area Bank will continue and will include David L. Kalkbrenner, President and Chief Executive Officer of Greater Bay Bancorp. Frank Bartaldo, Jr., President and Chief Executive Officer of Bay Area Bank, will remain in that capacity. John Gatto and Duncan Matteson, Co-Chairmen of Greater Bay Bancorp said, "With the merger of Bay Area Bancshares, Greater Bay Bancorp continues its successful super-community banking philosophy. We are very pleased to add another quality community bank to the Greater Bay family." Kalkbrenner added, "The merger with Bay Area Bancshares allows Greater Bay Bancorp to affiliate with an organization that has an excellent reputation and performance record, while strengthening our position in our primary target market area." Robert R. Haight, Chairman of the Board of Bay Area Bancshares, commented, "Bay Area Bank was established in 1979 and has long been considered one of the region's top independent banks. By combining with Greater Bay Bancorp, Bay Area Bank will enhance its ability to offer a wide range of financial services to its clients and to increase its lending capacity and market presence." Bartaldo added, "Bay Area Bank is reporting its eleventh consecutive year of record earnings today. The Bank's earnings for 1998 increased $533,000 or 29% to $2,395,000, resulting in a return on average equity of 20% and a return on average assets of 1.74%. Bay Area Bancshares ended the year with $155 million in assets representing an increase of $33 million or 27% during the year." The merger is subject to certain conditions, including the approval of Bay Area Bancshares' shareholders and regulatory approval, and will be accounted for as a pooling of interests Pooling of Interests An accounting method, used in mergers and acquisitions, where the balance sheet items of the two companies are simply added together. Notes: The opposite of pooling of interests is the purchase acquisition method. . Subject to those conditions, the merger is expected to be completed late in the first quarter of 1999 or early in the second quarter of 1999. Greater Bay Bancorp and its financial services subsidiaries, Cupertino National Bank, Mid-Peninsula Bank, Peninsula Bank of Commerce and Golden Gate Bank, along with its operating divisions, Greater Bay Bank Santa Clara Valley
The Santa Clara Valley is a valley just south of the San Francisco Bay in Northern California in the United States. Commercial Banking Group, Greater Bay Corporate Finance Group, Greater Bay Bank Contra Costa Contra Costa can refer to:
This document may contain forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those projected. For a discussion of factors that could cause actual results to differ, please see the publicly available Securities and Exchange Commission filings of Greater Bay Bancorp and Bay Area Bancshares, including their respective Annual Reports on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 1997, and particularly the discussion of risk factors within such documents. |
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