Silicon Valley Bank’s former parent, SVB Financial Group, filed for Chapter 11 bankruptcy protection in federal court in New York, the company said in a statement Friday.
The move will allow the company “to preserve value as it evaluates strategic alternatives for its prized businesses and assets” — primarily, venture-capital business SVB Capital and broker-dealer SVB Securities, William Kosturos, SVB Financial Group’s chief restructuring officer, said in the statement.
SVB Financial said it “believes” it has roughly $2.2 billion in liquidity, along with $3.7 billion in outstanding preferred stock. The company also owes bondholders about $3.3 billion, it said.
SVB Financial emphasized that Silicon Valley Bank, which went into Federal Deposit Insurance Corp. receivership March 10, is no longer affiliated with the company.
However, Kosturos said Friday that SVB Financial would “continue to work cooperatively” with the bridge bank.
“We are committed to finding practical solutions to maximize the recoverable value for stakeholders of both entities,” he said.
A coalition of SVB Financial creditors, including Centerbridge Partners, Davidson Kempner Capital Management and fixed-income investment management giant Pimco, formed an investment group this week in anticipation of a bankruptcy filing, and bought the company’s bonds at a steep discount, The Wall Street Journal reported.
The FDIC, however, could tap into proceeds from the sale of the parent company’s assets if the...
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