TUCSON, Ariz. - Pima Federal Credit Union and RBAZ Bancorp, Inc., the parent company of Republic Bank of Arizona, have announced a definitive agreement for Pima to acquire substantially all assets and assume liabilities of Republic Bank in an all-cash transaction. The deal is anticipated to provide RBAZ shareholders with approximately $22.00 per fully diluted share upon final liquidation, subject to adjustments.
This acquisition will expand Pima's presence into Phoenix and Maricopa County, adding three Republic Bank branches to its network, resulting in a total of twelve locations and over $1.5 billion in total assets. Eric Renaud, President and CEO of Pima, emphasized the shared values between the two entities and the strategic growth opportunity this presents for serving the local community.
Brian Ruisinger, President and CEO of RBAZ and Republic Bank, expressed enthusiasm for the partnership, highlighting the alignment in values and the benefits for customers, shareholders, and the community. He also mentioned the continuation of the 'Shop Local Dine Local Bank Local' legacy.
The agreement has received unanimous approval from both organizations' Boards of Directors and is now pending approval by RBAZ's shareholders, regulatory bodies, and the satisfaction of customary closing conditions. The transaction is expected to be completed in the second half of 2024, with Ruisinger set to lead the Phoenix market after the closure.
Pima Federal Credit Union, founded in 1951 and based in Tucson, operates nine locations and offers a range of personal and business banking products. As of March 31, 2024, Pima reported $1.2 billion in total assets. Republic Bank, established in 2007, currently operates three branches in the Phoenix metropolitan area with $279 million in total assets as of the same date.
The acquisition is subject to various factors, including regulatory and shareholder approvals, and the successful integration of the two entities. This press release statement contains forward-looking statements that are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated.
Financial advisory services for the transaction were provided by Olsen Palmer LLC to RBAZ and Donnelly Penman & Partners, Inc. to Pima, with legal advice from Fenimore Kay Harrison LLP and Luse Gorman, PC, respectively.
InvestingPro Insights
As RBAZ Bancorp, Inc. prepares for its acquisition by Pima Federal Credit Union, key financial metrics and InvestingPro Tips offer insights into the company's current market position. With a market capitalization of $20.41 million and a trailing twelve-month revenue of $10.85 million, RBAZ has demonstrated significant growth, boasting a revenue increase of 28.33% over the last twelve months as of Q1 2024.
An attractive aspect for potential investors or interested parties is RBAZ’s low price-to-earnings (P/E) ratio. Currently standing at 7.7, adjusted to 7.53 for the last twelve months as of Q1 2024, the P/E ratio suggests that the stock is trading at a low price relative to near-term earnings growth. This is further complemented by the company’s PEG ratio, which at 0.21 indicates potential undervaluation based on earnings growth projections.
InvestingPro Tips highlight that RBAZ is trading near its 52-week high, with the price 100% of this peak, indicating strong recent performance. Still, the stock is also considered to be in overbought territory according to the Relative Strength Index (RSI), which may suggest caution among traders.
Moreover, while the company has been profitable over the last twelve months, it does not pay a dividend to shareholders, which could influence investment decisions depending on individual strategies.
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