Ross Buying 25 Percent Stake in Sun Bancorp

Thursday, 08 Jul 2010 08:24 AM

 

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Billionaire investor Wilbur Ross is taking a 25 percent stake in Sun Bancorp, the New Jersey bank said on Thursday.

Ross, who in April invested millions in British entrepreneur Richard Branson's Virgin Money, has said he expects thousands of U.S. banks to fail as a result of the financial crisis. He has acquired stakes in banks in Florida and Michigan.

Ross's private equity firm WL Ross & Co and other investors, including the bank's largest shareholder, the Brown family, agreed to invest $100 million in common stock and preferred stock that will convert into common shares on shareholder approval.

The shares bought by WL Ross will represent 24.9 percent of holding company Sun Bancorp's outstanding shares on conversion, the bank said. The investment was made at $4 a share.

The Vineland, New Jersey-based bank's shares closed at $3.61 on Wednesday. The shares are down 3.7 percent this year.

Ross, in an interview with The New York Times on Wednesday, said Sun National Bank -- Sun Bancorp's main subsidiary -- could be the first of many banks he acquires in New Jersey.

Sun National said it will use the capital to "strengthen and expand current operations as well as to pursue growth opportunities throughout the state of New Jersey."

The bank has $3.5 billion in assets and 70 branches in New Jersey.

Ross will join the boards of Sun Bancorp and Sun National, the bank said

© 2014 Thomson/Reuters. All rights reserved.

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