Umpqua Holdings Corp., the parent company of Umpqua Bank, announced Tuesday that it has entered into a definitive agreement with Columbia Banking System, the parent company of Columbia State Bank, under which the companies will join together in an all-stock combination.
Under the terms of the agreement, which were unanimously approved by the boards of directors of both companies, Umpqua shareholders will receive 0.5958 of a share of Columbia stock for each Umpqua share they own. Upon completion of the transaction, Umpqua shareholders will own approximately 62% and Columbia shareholders will own approximately 38% of the combined company. Once the transaction is completed, the combined organization will be a leading West Coast franchise with more than $50 billion in assets, according to a news release from Umpqua Holdings Corp.
“This is an exciting combination that brings together two well-respected organizations and talented teams, accelerating our shared strategic objectives to create the leading regional bank headquartered in the West,” Cort O’Haver, president and CEO of Umpqua, said in the release. “Together, with increased scale, we’ll have the ability to provide expanded opportunities for associates and serve customers through an even more comprehensive suite of solutions. We’ll also be able to strengthen our ongoing investment in our communities and deliver tremendous value for shareholders. I look forward to partnering with the Columbia team to expand our market share as a combined organization.”
The combined company will be the West Coast’s leading regional bank with $43 billion in deposits, including $16 billion of deposits in Oregon, $15 billion in Washington, $10 billion in California and $2 billion collectively in Idaho and Nevada, the release said. The transaction strengthens the combined company’s competitive position in high-growth, attractive markets, including leading market share in the Seattle, Portland and Sacramento metro areas.
The transaction is expected to close in mid-2022, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals and approvals from each company’s shareholders.
“This is a historic partnership that will enhance what both banks are able to do for clients, team members and communities, while driving significant value for our shareholders. Importantly, Umpqua shares our values and relationship-based business model,” Columbia President and CEO Clint Stein said in the news release. “We believe blending the complementary expertise, services and innovative technology of both banks will position the combined organization as the preferred bank for business and families across the West. We look forward to bringing our companies together to better serve all stakeholders.”
Umpqua Holdings Corp., based in Portland, is the parent company of Umpqua Bank, a community bank recognized for its entrepreneurial approach and innovative customer experience. Umpqua Bank, which is headquartered in Roseburg, has locations across Oregon, Washington, California, Idaho and Nevada. Umpqua Holdings Corp. is headquartered in Portland.
Columbia Banking System is headquartered in Tacoma, Washington. It is the holding company of Columbia Bank, a Washington state-chartered full-service commercial bank with locations throughout Washington, Oregon, Idaho and California.
The combined company will be led by an executive team composed of leaders from both Columbia and Umpqua. O’Haver, President and CEO of Umpqua, will serve as the Executive Chairman and Stein, President and CEO of Columbia, will serve as CEO.
Chris Merrywell will serve as President of Consumer Banking, Tory Nixon as President of Commercial Banking, and Ron Farnsworth as CFO. Upon closing of the transaction, the combined company’s board will consist of seven directions from each of Columbia and Umpqua with Craig Eerkes, the current Chairman of Columbia, serving as the Lead Independent Director.
The combined holding company will operate under the Columbia Banking System, Inc. name and will be headquartered in Tacoma, Washington. The combined bank will operate under the Umpqua Bank name and will be headquartered in the greater Portland metropolitan area. Other major subsidiaries and divisions will include Columbia Trust Company, CB Financial Services and Columbia Private Bank, which will operate under the banner of Columbia Wealth Management, as well as Financial Pacific Leasing, Inc.
The company will trade under Columbia’s ticker symbol (COLB) on the Nasdaq Stock Market.