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Capital Bank to sell 9.9 percent stake to private equity fund

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Capital Bank of Raleigh plans to sell nearly 10 percent of its shares to a private equity fund in Philadelphia.

Patriot Financial Partners has agreed to buy 9.9 percent of Capital Bank's common stock at the same time the bank sells about $55 million worth of shares in a secondary offering. That deal is expected to close before Feb. 1.

As part of the deal, Patriot will appoint one director to Capital Bank's board. The firm focuses on investing in thrifts and community banks run by "strong management teams with successful track records," according to its Web site.

Bringing in an independent private equity firm could help Capital Bank officials sell its public offering to other investors. Capital Bank CEO B. Grant Yarber and Patriot partner James Lynch declined to comment, citing securities regulations related to stock sales by publicly traded companies.

Patriot will pay a maximum of $3.75 per share.

Capital Bank's shares fell 9 cents Monday to $3.96. The stock is down nearly 40 percent in the past year.

Capital Bank is selling more shares to raise money for various purposes, including as it looks to expand beyond North Carolina for the first time. The bank also may use some money to repay $41.3 million in stimulus money it received from the U.S. Treasury.

Capital Bank operates 32 branches across the state and has about $1.7 billion in assets.

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About the blogger

Assistant Business Editor Alan M. Wolf joined the N&O in 1999 covering the business of health care. He became an editor in 2001, and helps oversee the paper's daily business coverage and Sunday Work&Money section. He lives in Clayton with his wife and two children. Reach him at 919-829-4572 or e-mail him.