Harvard Winters
Long/short equity, growth at reasonable price, value

Whose Shareholders Come Out Ahead In The United Bankshares/Virginia Commerce Deal?

On January 30, Charleston, West Virginia-based United Bankshares Inc. (NASDAQ:UBSI) announced that it had agreed to acquire Arlington, Virginia-based Virginia Commerce Bancorp Inc. (NASDAQ:VCBI) for approximately $491 million in stock. The announced $14 per share deal price gives VCBI shareholders a 15% premium over the January 29 closing share price, and it equates to a 1.82x multiple of VCBI's year-end 2012 tangible book value per share (TBV-PS).

Whose shareholders should be happy? Did UBSI buy cheap? Did VCBI sell at or above its intrinsic value?

First, some background on UBSI. UBSI is acquisitive. It has completed 15 acquisitions, most of them small, comprising over $1 billion in aggregate transaction value since 1990. The more recent deals...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
FREESA PRO MEMBERS
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details