Why Shares of Columbia Banking System Are Down Today
Shares of Columbia Banking System (NASDAQ: COLB) traded down 14% at midday on Tuesday after the regional bank announced plans to combine with Umpqua Holdings (NASDAQ: UMPQ). The deal will create a West Coast banking powerhouse, but investors are not feeling enthusiastic about the deal on Tuesday.
Before markets opened, Columbia Banking and Umpqua announced an all-stock merger that would create a $7.7 billion market capitalization bank with more than $50 billion in combined assets. Terms of the deal call for Umpqua shareholders to receive 0.5968 shares of Columbia Banking for each Umpqua share they own. Based on Monday's closing price, Umpqua shareholders are getting about $23.44 per share, a 12% premium.
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Source Fool.com
