The Fresno Cen Cal Business finance Group office is located at 5094 N. Fruit Ave. Suite 103, in Fresno. Cen Cal photo

For the second time in less than four months, Fresno-based Cen Cal Business Finance Group announced merger plans, this time with a Kern County organization with more than $71 million in loans on the books.

Cen Cal Business Finance Group and Bakersfield-based Mid State Development Corp. publicly announced plans to merge this week with expected completion in mid-January 2024, about three weeks after final approval is received from the Small Business Administration.

 As of Dec. 1, 2023, Mid State had a total of 191 loans for $71.3 million, and Cen Cal had a total of 336 loans for $160.7 million.

Cen Cal was founded in 1984, providing fixed-rate, Small Business Administration 504 loans for owner-occupied real estate acquisitions and equipment purchases to small- and medium-sized business throughout the Central Valley and Central California Coast, partnering with banks, credit unions and private lenders.

Under the executive leadership of Frank Gallegos, Cen Cal completed a merger last month with Santa Maria-based Coastal Business Finance, expanding Cen Cal’s lending portfolio and Central California footprint.

Cen Cal will be the surviving SBA-designated Certified Development Company and will maintain Mid State’s current office at 1631 17th St. in Bakersfield. All employees from both organizations will remain.

Keith Brice, Mid State Development president, will retire once the merger is complete. Cen Cal will hire a local business development officer in Bakersfield to take his place. 

“I will be riding off into the sunset after 24 years with Mid State Development Corporation and a 45-year career in commercial lending,” Brice said in a news release. “The merged company will be in great hands under the leadership of Frank Gallegos. I’ve known Frank several years. I consider him a friend and an excellent person to carry the organization forward into the future.”   

Cen Cal Board President Tal Cloud, president of Fresno-based Paper Pulp and Film Converters, considers himself a cheerleader for 504 loan borrowers because of the importance the program made in his life.

“I received a 504 loan in the 1990s through Mid State and was able to purchase real estate for my business. I understand how important it is for business owners to be able to do that and to have the certainty of fixed payments for 20 years or more,” Cloud said.

New plans for Bakserfield include the launch of a micro loan program that will extend support to segments of the community not presently being reached, according to Gallegos. The new loan fund will be a completely privately funded Revolving Loan Fund for existing Bakersfield small businesses.  Loans will range from $10,000 to $25,000 and can be used for equipment, working capital, and inventory. 

Gallegos said they plan to hire local college interns to help work with clients to process the loans.

Three Mid State board members — Deanna Blaise of Valley Strong Credit Union; commercial real estate broker Anthony Olivieri and another person — will be added to Cen Cal’s board of directors, as well as a newly created non-voting Bakersfield advisory board to assist with community opportunities and awareness.