What Jay Sidhu couldn't get from the public markets, he found in private placements.
Customers Bancorp, the Wyomissing, Pa., company led by Sidhu, closed a private placement of $85 million Thursday; it priced at $14 a share. Customers, which has assets of $2.3 billion, raised $15 million in a separate private placement in July and August.
The $14-per-share price tag for the two placements is 1.02 times the company's tangible book value and in the range Customers had expected to fetch in an initial public offering this year. It had planned to raise $92 million to $123 million at $13 to $15 a share in the IPO, which was called off in May because of poor market conditions.
The $100 million in new capital is a 63% boost to the company's existing equity base. The proceeds will be used to support organic growth and general corporate purposes, Customers said in a news release.
"We are seeing solid loan growth and are committed to maintaining a strong balance sheet, so this offering made sense given the investor demand for our stock," Sidhu, the chairman and chief executive, said in the press release.
Sidhu is noted for growing Sovereign Bank's assets from $500 million to more than $90 billion in two decades before resigning in 2006 as credit and integration problems arose. Banco Santander SA acquired Sovereign in 2009.
Sidhu has repeatedly vowed that Customers would focus on organic growth and selectively pursue deals. Since Sidhu took over in 2009, Customers has acquired two failed banks and an open bank.