Over the past few months, one of the hottest sectors has been the financials. And to capitalize on things, Wall Street is looking to the IPO market. So, this week Plains Capital Corp. filed to go public, planning to raise $140 million.
Founded in Lubbock, Tex., in 1987, Plains Capital has had a nice growth path. The company has bulked up its assets through acquisitions, as well as by adding new offerings (such as mortgage origination and even wealth management). In fact, the bank has been profitable for the past 21 years. Currently, Plains Capital has $4.4 billion in assets and $2.9 billion in deposits.
With the proceeds of the IPO, the company plans to redeem its $92 million TARP (Troubled Asset Relief Program) to the U.S. Treasury. There will also be another $20 million payment for the loan from JPMorgan (NYSE: JPM).
All in all, these actions will clean up the balance sheet and allow for more growth for Plains Capital. Interestingly enough, it looks like the company plans to rev up its M&A activities -- especially with distressed assets in the banking sector.
The lead underwriter on the IPO is JPMorgan and the proposed ticker is PCB.
Tom Taulli is the author of various books, including The IPO Primer and The Complete M&A Handbook
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