“Large financial institutions” are exploring a potential acquisition of SVB Financial.
Silicon Valley Bank’s parent company is in talks to sell itself outright after the embattled tech lender’s executives failed in efforts to raise outside capital, according to a report Friday.
Shares of SVB Financial plunged 60% on Thursday as concerns about its solvency sparked client fears and wider concerns that theThe S&P 500 banks index plunged more than 6% on Thursday and opened lower on Friday.The panic ensued after SVB was forced to pursue a $21 billion fire sale of its bond portfolio to stave off a cash crunch. The bank estimated it took a $1.8 billion loss on the sale.
Several prominent venture firms, including billionaire Peter Thiel’s Founders Fund, urged startups to pull their money from SVB due to fears it could collapse.Bloomberg via Getty Images On Wednesday, SVB had said it was aiming to sell $1.25 billion in common stock and an additional $500 million of convertible preferred shares as part of its effort to raise cash and assuage concerns among its clients.Separately, SVB reached a deal with investment firm General Atlantic to sell $500 million of common stock, but that deal was dependent on the completion of its initial share sale.
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