SkyBridge Capital, led by Anthony Scaramucci, is among the frontrunners bidding for Silicon Valley Bank’s VC arm, with a sale foreseen in the coming weeks.
SVB Financial Group, once the umbrella organization for Silicon Valley Bank, is reportedly nearing the final stages of negotiations to sell its venture capital subsidiary, SVB Capital.
According to The Wall Street Journal, informed sources have indicated that Anthony Scaramucci’s SkyBridge Capital and Atlas Merchant Capital are in tight competition with San Francisco-based Vector Capital in the concluding rounds of the bidding war.
Insiders have suggested that SVB’s venture capital segment could fetch a price between $250 million and $500 million. Nonetheless, they emphasized that a definitive sale is not specific and remains subject to the approval of the creditor’s committee.
A verdict regarding the sale is anticipated to be announced in the forthcoming weeks.
Silicon Valley Bank bankruptcy
It is important to note that SVB Capital was exempted from the broader Chapter 11 bankruptcy proceedings that engulfed SVB Financial Group. The bank has assured that SVB Capital will maintain its regular business operations even as it is listed for sale.
SVB Capital has established itself as a significant player in the investment sector, supporting numerous renowned Silicon Valley venture capital entities, including Sequoia and Andreessen Horowitz (a16z).
As of the end of 2022, the firm managed assets amounting to $9.5 billion, distributed across 20 funds and 760 companies. This portfolio includes investments in Chainalysis, a notable blockchain analytics service.
SkyBridge Capital, one of the potential buyers, oversees about $1.8 billion in assets, with nearly $580 million invested in cryptocurrencies and related digital asset ventures.
Earlier in 2023, Silicon Valley Bank faced a significant setback when it was closed down by the financial regulators in California on March 10, subsequently filing for bankruptcy a week later, on March 17.
This event marked a downturn in the bank’s fortunes, which had previously been one of the few establishments offering banking services to cryptocurrency firms in the U.S.
This downfall was part of a more significant crisis that saw other crypto-friendly banks like Signature Bank and Silvergate Bank also facing severe challenges in the most considerable banking crisis witnessed since 2008.
In a related development earlier this year, SVB Securities, the investment banking division of SVB Financial, was acquired by its founder, Jeff Leerink, along with other top executives, in a deal valued at $100 million.