Alan White, chairman and CEO of Dallas’ PlainsCapital Corp., seemed tired and a little wary last night–understandably so. White (pictured) was back in town after a grueling, three-week-long “road show” in support of the financial-services company’s initial public offering, which PlainsCapital abruptly yanked on Nov. 4. It had been trying to raise $225 million, about $90 million of that to pay back TARP money the bank got from the feds in 2008.
So, why did the IPO misfire so badly? During those three weeks, White said, the Dow sagged back below 10,000, and stock in a Chicago bank called PrivateBancorp lost 40 percent of its value, scaring off Wall Street. Then, when Texas banks like Cullen/Frost and Texas Capital began reporting third-quarter earnings declines, the pressure was on for PlainsCapital to reduce its offering price of $14 to $16 per share. And, White said, “I wouldn’t do that.”
Ron Steinhart, a veteran Dallas banker, says PlainsCapital’s timing was off: “The stars just didn’t line up right.” In the meantime, White said he’s in no rush to schedule another IPO–he’s got nearly 10 years to pay back the fed dough, which his bank is using to make loans–as PlainsCapital is fundamentally sound. “Like my preacher says,” White added, smiling, “I’ll just fake it ’til I make it.”
