New Firm Looks to Capitalize on Private Equity

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A new investment banking firm has started up in Century City, with its founders hoping to take advantage of the abundant capital being thrown around by private equity firms.

Diamond Capital Partners, which opened its doors in May, will assist companies in raising capital, securing valuations, and structuring mergers and acquisitions. The firm plans to focus on middle-market companies with revenue of $20 million to $200 million.

Managing Partner Robert Whyte, who co-founded the firm with four colleagues, said private equity firms today are not shy about pulling out their pocketbooks and seizing undervalued companies; Diamond Capital was started to help those companies find the best offers and complete the deals.

“In the capital-raising world, there is a lot of private equity money right now looking for opportunities,” said Whyte, who along with the other founders left Sherman Oaks investment bank Mosaic Capital LLC to start Diamond Capital. “In the last 45 days, our phones have been extremely active.”

By connecting companies with private equity firms known to Diamond’s partners, the firm also intends to help companies navigate the equity or debt markets if they are looking to raise fresh capital. Whyte said the firm expects to announce its first deal the closing of a sale of a technology company this week.

What’s more, the firm also expects to announce the hiring of two more partners, boosting its ranks of managing directors to 10. Whyte said it is an opportune time to be hiring investment bankers because many good candidates are being laid off from competing firms.

Diamond Capital’s partners have experience in a range of industries including media and entertainment, health care, consumer goods, Internet, technology and manufacturing but the firm plans to focus on all types of companies, Whyte said.

The firm also has opened offices in New York and Nashville, Tenn.


Branch Conversion

The last vestiges of Alliance Bank, the Culver City institution that was seized by regulators in February, disappeared last week.

The bank’s three branches in Culver City, Brentwood and Westlake Village were converted June 15 into offices of California Bank & Trust, a San Diego institution that bought the assets of Alliance from the Federal Deposit Insurance Corp. In addition to the branches, more than 6,000 Alliance deposit accounts were integrated into California Bank & Trust.

“Now former Alliance customers can benefit from joining our bank, which has an array of financial products and high-quality customer service,” said Scott Monson, managing director of California Bank & Trust’s commercial banking division, in a statement.

The conversion gives California Bank & Trust 93 branches in the state.


Loan Drop

The Small Business Administration announced a dip in the number of so-called SBA-504 loans, primarily used for office and industrial properties, which were approved in Los Angeles last month.

After approving 28 loans in April, the agency’s local office OK’d 21 in May. The total value of the May loans fell to $38 million, a 17 percent decline from the previous month.

Still, with $84 million approved over the past two months, the total has already exceeded the $74 million in loans approved during the entire first quarter. Loan approvals are sensitive to fluctuations in interest rates.


Capital Plan

Preferred Bank, a Chinese-American bank in Los Angeles, announced a plan to raise as much as $10 million through the issuance of new stock.

The bank said it will first offer current shareholders subscription rights for the newly created shares. The offering price was not announced.

Shares of Preferred closed June 18 at $4.09. The bank said it expects to commence the rights offering by early July.

Preferred reported a net loss of $1.3 million for the first quarter due to an increase in the provision for credit losses.


C-Suite News

First California Financial Group Inc., the Westlake Village holding company for First California Bank, announced that William Schack has been promoted to chief credit officer. The position was previously held by Walter Duchanin, who died unexpectedly in November. Hanmi Financial Corp., the Los Angeles parent of Hanmi Bank, announced that Charles Kwak has been appointed to the boards of the company and the bank, effective July 1. Dan Kawamoto, chief financial officer of 1st Century Bancshares Inc., has submitted a letter of resignation in order to join a Silicon Valley bank. No replacement has been named. Mercanti Group, a Minneapolis investment bank, announced that Tom Clerkin has been named a managing director in the firm’s L.A. office.


Staff reporter Richard Clough can be reached at [email protected] or at (323) 549-5225, ext. 251.

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