In a $55 million deal, Bank of Nevada’s parent company plans to buy the holding company of Service1st Bank of Nevada.
Western Alliance Bancorp. said Friday it signed a definitive agreement to purchase Western Liberty Bancorp. The deal is expected to close this fall.
At that point, Service1st will merge into Bank of Nevada.
Under the terms of the deal, Western Liberty shareholders can choose to receive either $4.02 in cash or 43 percent of a share of Western Alliance for each share they owned in Western Liberty.
Western Alliance stock closed Friday at $9.54 per share. Western Liberty's stock closed at $2.85 per share on Friday.
Robert Sarver, chairman and CEO of Western Alliance, said the buyout strengthens the company’s capital position and increases its deposits.
Bill Martin, CEO of both Service1st and its parent company, said in a prepared statement that the deal adds “greater lending capacity for our customers and new opportunities for growth for the bank.”
Phoenix-based Western Alliance has $7.2 billion in assets and owns subsidiary banks in Nevada, California and Arizona. As of last summer, Bank of Nevada had 12 branches in Southern Nevada and nearly $2.5 billion of local deposits, according to Federal Deposit Insurance Corp. data.
Western Liberty, on the other hand, has $199 million in assets. As of last summer, Service1st had two branches in the region and $132 million of local deposits.
Western Liberty has said the bank is seeking state approval to close one of those branches. Located at 8965 S. Eastern Ave. in Las Vegas, the branch had roughly $36 million of deposits as of last summer. By comparison, Service1st's main office, at 8349 W. Sunset Road in Las Vegas, holds $96 million of deposits.
The buyout announcement comes a few days after Western Liberty reported losing $1.5 million, or 11 cents per share, in the quarter ending June 30.
That compares with a loss of $4.6 million, or 30 cents per share, during the same period last year.
The company increased the size of its loan portfolio by 3.3 percent this past year to $104.8 million, though its deposits slipped 5.6 percent to $124.3 million.
Besides Service1st, Western Liberty owns Las Vegas Sunset Properties.
That subsidiary was formed last year to own and manage certain nonperforming assets connected to the bank.