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Humboldt Bancorp to Expand

August 13, 2003|From Bloomberg News

Humboldt Bancorp, a Northern California bank, agreed Tuesday to buy California Independent Bancorp for about $80 million as Humboldt adds branches from Sacramento north to the Oregon border.

Humboldt will pay $35.50 in cash or stock for each share of California Independent, 23% more than Monday's closing price of $28.90. On Tuesday, shares of California Independent rose $5.81 to $34.71 on Nasdaq.

Yuba City-based California Independent is the holding company of Feather River State Bank and has nine branches in Sutter, Yuba, Colusa, Yolo and Placer counties.

Humboldt, based in Roseville, is selling and closing its branches in Southern California and adding locations in the northern part of the state, Chief Financial Officer Patrick Rusnak said. After the purchase, Humboldt said it would have 26 branches throughout Northern California and about $1.5 billion in assets.

"It just didn't make sense for us to have branches that stretched from Eureka to San Diego," Rusnak said. "We're not a big enough bank to be spread that far away."

He said the company would continue to make acquisitions and open new branches.

Shares of Humboldt fell 57 cents, or 3.6%, to $15.33 on Nasdaq.

Humboldt also would assume about $34 million of California Independent debt in the transaction, Rusnak said. Humboldt had about $82 million of debt at the end of the second quarter, and no immediate plans to pay it off, he said.

The purchase is expected to be completed in the first quarter and would add to earnings within the first year.

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