Wilbur Ross Acquires More Shares of Distressed Sun Bancorp (SNBC)
Mr. Ross, 74, is known for investing in distressed business and restructuring failed companies. He has been very successful with investing in steel, coal, and telecom industries in previous economic downturns. He has been bottom-fishing in mortgages companies and banks in the latest recession.
The bank offered 28.75 million shares at $3 per share and expected to raise approximately $81 million in net proceeds. The three largest private equity investors in the bank—Wilbur Ross, Siguler Guff and the Brown family—agreed to purchase 10,193,224 total of the stock in the offering.
In January, the company reported a net loss available to common shareholders of $28.1 million due to commercial real estate loans, fair value credit adjustments on customer derivatives, and conversion of shares.
In July of last year, Mr. Ross announced his private equity firm’s decision to invest $50 million for a 24.9% stake in the New Jersey bank. He received about 12.5 million shares from the last deal. The latest capital injection lowered his average cost, and increased his stake in the company.
The trade price of Sun Bancorp stock has jumped 19.3% since its stock offering. After Mr. Ross’ initial investment in July of last year, the stock shot up 38% immediately.