Business Combinations

12 Months Ended

Dec. 31, 2022

On March 25, 2022, the Company completed its acquisition of Valley Republic Bancorp (VRB), including the merger of Valley Republic Bank into Tri Counties Bank, with Tri Counties Bank as the surviving entity, in accordance with the terms of the merger agreement dated as of July 27, 2021. The cash and stock transaction was valued at $174,016,000 in aggregate, based on TriCo's closing stock price of $42.48 on March 25, 2022. Under the terms of the merger agreement, the Company issued 4,105,518 shares, in addition to approximately $431,000 in cash paid out for settlement of stock option awards at VRB.

The acquisition of VRB has been accounted for as a business combination. The Company recorded the fair values based on the valuations available as of acquisition date, and subject to adjustment up to one year following the merger date of March 25, 2022. During the fourth quarter of 2022, an adjustment to the initial allocation was based on more detailed information obtain about tax-related matters. Management believes the purchase price allocation is now finalized as December 31, 2022.

The following table summarizes the consideration paid for VRB and the amounts of assets acquired and liabilities assumed that were recorded at the acquisition date (in thousands):


	Estimated Fair Value March 25, 2022		Adjustments		Fair Value December 31, 2022
Fair value of consideration transferred:
Fair value of shares issued	$	173,585	$	—	$	173,585
Cash consideration	431		—		431
Total fair value of consideration transferred	174,016		—		174,016
Assets acquired:
Cash and cash equivalents	427,314		—		427,314
Securities available for sale	109,716		—		109,716

Loans and leases	771,353		—		771,353
Premises and equipment	4,658		—		4,658
Cash value of life insurance	13,609		—		13,609
Core deposit intangible	10,635		—		10,635
Other assets	26,244		3,500		29,744
Total assets acquired	1,363,529		3,500		1,367,029
Liabilities assumed:
Deposits	(1,215,479)		—		(1,215,479)
Subordinated debt	(47,236)		—		(47,236)
SERP liability	(3,352)		—		(3,352)
Other liabilities	(10,516)		—		(10,516)
Total liabilities assumed	(1,276,583)		—		(1,276,583)
Total net assets acquired	86,946		—		90,446
Goodwill recognized	$	87,070	$	(3,500)	$	83,570