SVB Financial Group, the former parent company of Silicon Valley Bank (SVB), is reportedly finalizing a deal to sell its venture capital arm, SVB Capital. SkyBridge Capital, led by Anthony Scaramucci, and Atlas Merchant Capital are in competition with San Francisco- based Vector Capital in the late stages of the bidding process. While sources suggest the sale could fetch anywhere from $250 million to $500 million, it's important to note that a final agreement is not guaranteed, and the deal would still need to undergo review by a creditors committee. A court decision regarding the sale is expected in the coming weeks.
Notably, SVB Capital wasn't part of SVB's overall Chapter 11 bankruptcy proceedings. The bank has stated its intention to continue its "normal business operations" despite being put up for sale. SVB Capital is known for its investment capital platform, which makes a wide range of investments, including backing from prominent Silicon Valley venture capital firms like Sequoia Capital and Andreessen Horowitz (a16z). As of December 2022, SVB Capital managed assets worth $9.5 billion across 20 funds and had investments in 760 companies, including blockchain analytics service Chainalysis.
SkyBridge Capital, on the other hand, manages approximately $1.8 billion in assets, with around $580 million invested in cryptocurrencies and other digital assets. Earlier this year, Silicon Valley Bank faced regulatory action and was shut down by California financial regulators on March 10, subsequently filing for bankruptcy on March 17. Before its collapse, Silicon Valley Bank was one of the few institutions in the United States that provided banking services to cryptocurrency companies.
This development marked a significant moment in the broader banking industry, with SVB joining other crypto and tech-friendly banks like Signature Bank and Silvergate Bank in experiencing challenges during what some have characterized as the most significant banking crisis since 2008. Earlier in the year, SVB Financial's investment banking division, known as SVB Securities, was sold to its founder, Jeff Leerink, and other senior executives for $100 million.
