December 9, 2009 / 11:17 PM / 9 years ago

UPDATE 1-Canadian Western to buy National Leasing

* Deal valued at about C$130 mln in stock and cash

* Deal seen adding modestly to earnings in 2010

* Transaction expected to close around Feb. 1

TORONTO, Dec 9 (Reuters) - Canadian Western Bank (CWB.TO), which said in September it plans to double in size in coming years, said on Wednesday it agreed to buy commercial equipment lessor National Leasing Group in a cash and stock deal worth C$130 million ($123 million).

One of the country’s smallest banks on a national level but a leader in the four western provinces, Canadian Western said the acquisition will be funded with a minimum C$48.75 million in cash and a maximum C$48.75 million of common shares — based on a price of approximately C$22.42 per CWB common share.

Chief Executive Larry Pollock said in September he was looking at every acquisition opportunity and intended to double the size of the bank and its net income in the next five years.

The acquisition is expected to modestly add to consolidated earnings per diluted common share in fiscal 2010, the bank said.

Because the acquisition will be partly funded with an issue of common shares, it should have a moderately negative impact on the bank’s regulatory capital ratios, but they will remain strong, CWB said in a statement.

National Leasing specializes in commercial equipment leasing and is the largest privately held lessor for small to mid-size transactions in Canada.

CWB is the largest bank headquartered in Western Canada. It has total balance sheet assets of about C$12 billion, assets under administration of over C$5 billion and assets under management near C$1 billion, and specializes in mid-market commercial lending.

The transaction is expected to close on or about Feb. 1, subject to regulatory approvals and other conditions.

$1=$1.05 Canadian Reporting by Pav Jordan, editing by Rob Wilson

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