ANCHORAGE, Alaska - Northrim BanCorp, Inc. (NASDAQ:NRIM), an Alaska-based banking institution, has completed its acquisition of Sallyport Commercial Finance, LLC, a provider of financial services to small and medium-sized businesses in North America. The all-cash deal, which closed on October 31, 2024, is valued at approximately $53.9 million.
The acquisition is anticipated to augment Northrim's earnings by about 15% for the fiscal year 2025. Northrim's President and CEO, Mike Huston, expressed admiration for the quality of business built by Sallyport and noted the alignment of core values between the two entities. He emphasized the opportunity to partner without detracting from Northrim's Alaskan banking operations.
Sallyport, established in 2014, has surpassed $5 billion in debts factored as of 2023. It will continue to operate as a wholly-owned subsidiary, complementing Northrim's existing factoring division. The executive management team at Sallyport, with over a century of combined industry experience, will remain in their current roles.
Nick Hart, Co-Founder and President of Sallyport, shared his positive experience with Northrim and enthusiasm for the future collaboration.
Northrim has a history of investing in financial enterprises, holding interests in Residential Mortgage, LLC, Pacific Wealth Advisors, and Pacific Portfolio Consulting. The company's growth and diversification strategy have been marked by such investments.
The acquisition is expected to strengthen Northrim's service offerings and market position, as indicated by the company's advisory team, which included Janney Montgomery Scott LLC and Accretive Legal, PLLC, with Keefe, Bruyette & Woods, and Latham & Watkins LLP advising Sallyport.
An investor conference call to discuss the acquisition is scheduled for Monday, November 4, at 9:00 a.m. Alaska Time (1:00 p.m. ET).
This news is based on a press release statement and contains forward-looking statements subject to risks and uncertainties, including those related to the integration and expected benefits of the acquisition.
InvestingPro Insights
Northrim BanCorp's recent acquisition of Sallyport Commercial Finance aligns well with the company's strong financial performance and growth strategy. According to InvestingPro data, Northrim has demonstrated impressive revenue growth, with a 12.7% increase over the last twelve months as of Q3 2024. This growth trajectory is likely to be further bolstered by the Sallyport acquisition, which is expected to enhance earnings by approximately 15% in fiscal year 2025.
InvestingPro Tips highlight Northrim's attractive valuation and dividend history. The company is trading at a low P/E ratio relative to its near-term earnings growth, with a current P/E ratio of 11.32. This suggests that the stock may be undervalued considering its growth prospects. Additionally, Northrim has maintained dividend payments for 30 consecutive years and has raised its dividend for 14 consecutive years, showcasing its commitment to shareholder returns.
The acquisition is poised to complement Northrim's strong financial position. The company boasts a high operating income margin of 31.34% for the last twelve months as of Q3 2024, indicating efficient operations. With a dividend yield of 3.8% and a market capitalization of $359.11 million, Northrim presents an interesting opportunity for investors seeking growth and income.
For those interested in a deeper analysis, InvestingPro offers 10 additional tips for Northrim BanCorp, providing a more comprehensive view of the company's financial health and market position.
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