A so-called blank-check company said it has acquired two Nevada community banks in what it called the largest such recapitalization of a banking company in U.S. history.
The move suggests a new form of financing that may be available for a troubled banking industry that is seeking new sources of capital to bolster balance sheets.
Global Consumer Acquisition Corp, the blank-check company, on Tuesday said it was creating the commercial bank holding company Western Liberty Bancorp to acquire the assets.
Its purchase includes the Nevada branch operations of Alabama-based Colonial BancGroup Inc (CNB.N), and 1st Commerce Bank, a Nevada banking unit of Capital Bancorp Ltd, which has offices in Arizona and Michigan.
The combined company will have $547 million of deposits, $474 million of loan assets and 22 branches, and operate under the 1st Commerce name.
Blank-check companies, formally known as special purpose acquisition companies (SPACs), were popular before the credit crisis hit two years ago. But many have had trouble finding things to buy. Global Consumer went public in 2007.
Jason Ader, chief executive of New York-based Hayground Cove Asset Management, which sponsored Global Consumer, will be chief executive of Western Liberty.
He said the company plans to be a very active partner in government-assisted deals involving other depository institutions. The company plans to focus on conservative business and commercial real estate lending, consumer lending, trade finance and deposits.
Global Consumer said the timing of the closing depends on regulatory approvals. It said the law firms Brownstein Hyatt Farber Schreck LLP, Crowe Horwath LLP and Proskauer Rose LLP provided legal advice.
(Reporting by Jonathan Stempel; editing by John Wallace)