LAKE OSWEGO, Ore.–(PRNewswire-FirstCall)–West Coast Bancorp (Nasdaq: WCBO) (“WCB” or the “Company”) today announced that it has received capital investments with gross aggregate proceeds in the amount of $155.0 million, $134.2 million of which has been contributed to its wholly owned banking subsidiary, West Coast Bank.
“The capital raise enhances West Coast Bank’s capital position and increases its pro forma total risk-based capital ratio to 17.01%, considerably above the level required by bank regulators,” said CEO and President Robert D. Sznewajs. “This capital raise will also strengthen our liquidity position and is an important reflection of the confidence that our new investors have in West Coast Bank, its management and business plan. Enhancing West Coast Bank’s capital and liquidity positions has been a key priority over the past year as we continue to work through the challenges presented by the prolonged economic downturn in our market areas. Additionally, the capital raise will allow West Coast Bank to address future impacts of the weak economy and will support the borrowing needs of our communities during these tough economic times.”
The new, unaffiliated investors have been issued shares of Series A Mandatorily Convertible Participating Preferred Stock (“Series A Preferred Stock”) and Series B Convertible Participating Preferred Stock (“Series B Preferred Stock”). The unaffiliated investors include, among others, MFP Partners, L.P., a family investment partnership managed by Michael F. Price; Castle Creek Capital; and GF Financial, LLC. The Series A Preferred Stock will mandatorily convert into common stock upon receipt of necessary shareholder approval. The Series B Mandatorily Convertible Preferred Stock will convert into common stock only following receipt of necessary shareholder approval and after being sold to unaffiliated third parties in a widely dispersed offering by its initial owner. The Company has agreed with the investors to promptly seek shareholder approval for the transactions, which is required, both to increase the authorized shares of common stock available for issuance, and under applicable NASDAQ listing rules. The Company intends to file a proxy statement with respect to these shareholder approvals as soon as practicable.
As part of the transactions two of the investors are entitled to representation on the Board of Directors of West Coast Bancorp and West Coast Bank and two other investors are entitled to have board observers. In the event the investors exercise their rights and subject to receipt of necessary regulatory approvals, the Board expects to appoint the board representatives in the near future and will announce these appointments when made. In addition, the terms of the investments permit the Board of Directors of West Coast Bancorp, in its sole discretion, to conduct a rights offering of up to $10 million in the near future in which the new investors would not participate.