Less than a week after making a deal with a private-equity firm and the Treasury Department, Sterling Financial Corp. in Spokane announced it is raising $555 million in capital through private placements with several investors.
The $10.5 billion-asset company said the $555 million will be raised through a combination of common and convertible preferred stock. The company said Monday it would sell 221.9 million common shares at 20 cents a share, a 77% discount from Friday's closing price.
Last Tuesday, the company announced that Thomas H. Lee Partners LP, a Boston private-equity firm, would invest roughly $135 million in the ailing thrift company — if it raised an additional $585 million. On Monday, Sterling announced that the private-equity firm had boosted its planned investment to $170 million, bringing the total of new capital to $725 million.
Thomas H. Lee's investment was conditioned on the Treasury's willingness to accept $75.8 million of common equity in exchange for the $303 million of preferred shares it purchased from Sterling through the Troubled Asset Relief Program. The company said last week that the Treasury had accepted the offer.
