HomeStreet, Inc. and Mechanics Bank jointly announced a definitive merger agreement for an all-stock business combination. Under the terms, HomeStreet Bank will merge into Mechanics Bank, with HomeStreet, Inc. being renamed Mechanics Bancorp and remaining a publicly traded company. The transaction values HomeStreet at an estimated equity value of $300 million.
Upon completion, existing HomeStreet shareholders are expected to own approximately 8.3% of the combined company, while Mechanics Bank shareholders will hold 91.7%. The combined entity will have 168 branches and approximately $23 billion in assets, expanding Mechanics Bank's West Coast footprint. Mark Mason, HomeStreet's Chairman, President, and CEO, will remain with the combined company in a consulting capacity.
The merger is subject to customary closing conditions, including regulatory approvals from the Federal Reserve, FDIC, and California and Washington state financial regulators, as well as approval by HomeStreet's shareholders. The transaction is expected to close in the third quarter of 2025.
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