SVB Capital Could Sell for $500 Million; Scaramucci Among Bidders

Silicon Valley Bank’s former owner is reportedly close to selling its venture capital business.

SVB Capital has attracted two top bidders, The Wall Street Journal (WSJ) reported Friday (Sept. 15), citing sources familiar with the matter. Those potential buyers include SkyBridge Capital, and Atlas Merchant Capital — both working together — and Vector Capital. SkyBridge was founded by Anthony Scaramucci, famous for serving as President Donald Trump’s communications director for just 10 days.

Sources told the WSJ the business could sell for between $250 million and $500 million, with a court decision on the buyer expected in the coming weeks.

Silicon Valley Bank (SVB) was taken over by regulators in March after a run on its deposit. Its failure kicked off a larger crisis in regional banking, with two other lenders — Signature Bank and First Republic Bank — also folding.

Owner SVB Financial Group filed for bankruptcy soon after, selling most of Silicon Valley Bank’s loans and deposits of SVB to First Citizens.

In July, a bankruptcy judge approved the sale of SVB Financial Group’s investment bank to its managers. SVB Financial had purchased Leerink Financial Partners in 2019 for $280 million and rechristened it SVB Securities.

The buyers include members of the unit’s management team and Jeff Leerink, who founded the company and ran it after it had been acquired. 

Meanwhile, shockwaves from SVB’s downfall continue to be felt. As PYMNTS wrote last month, both SVB and FDIC went from being “formerly obscure acronyms” this spring to becoming household names.

“That’s because after SVB collapsed due to a structurally weakened balance sheet, compounded by a panic-induced bank run, it entered into an FDIC [Federal Deposit Insurance Corp.] receivership along with two of its regional peers, Signature Bank and Silvergate Bank,” the report said. 

The downfall led to calls for action, suggested by the FDIC’s recent notice of proposed rulemaking (NPR) to require insured depository institutions with more than $100 billion in assets to maintain a minimum amount of long-term debt.

“The failure earlier this year of three large regional banks only underscored the agencies’ urgency in considering whether to put forward such a proposal,” FDIC Chairman Martin J. Gruenberg said in a statement.

“[A] long-term debt requirement such as the one being proposed today can mitigate the resolution challenges encountered in the failure of large regional banks and bolster financial stability,” Gruenberg added.