National Penn Buys Back $75M in Stock from Warburg

By Antonio Olivero January 28, 2014, 6:54 p.m. EST 1 Min Read

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National Penn Bancshares (NPBC) in Boyertown, Pa., has bought back about $75.4 million of shares from the private-equity firm Warburg Pincus.

The $8.6 billion-asset National Penn announced Tuesday that it bought back 7 million shares, or approximately 27% of the outstanding common shares owned by Warburg Pincus, at $10.77 per share.

The price is the same as the closing price of National Penn common stock on Monday. Its shares rose one cent on Tuesday, to $10.78.

Warburg Pincus will own 13.6% of National Penn's outstanding common stock after the repurchase transaction.

"The deployment of this $75.4 million of excess capital is part of our previously announced capital management strategy," National Penn Chief Executive Scott Fainor said in a press release. "Our relationship with Warburg Pincus remains strong, and we look forward to their ongoing ownership in our company as we continue to focus on enhancing long-term shareholder value."

National Penn announced last week that it will close nine branches, lay off an undisclosed number of employees and consolidate administrative facilities.

National Penn's fourth-quarter earnings dropped 16% from the fourth quarter of 2012, to $21 million.

Michael Martin, managing director and head of Warburg Pincus' financial services group, said in the release that Warburg Pincus has been pleased with National Penn's ability to generate shareholder value and that Warburg Pincus continues to view National Penn as a long term investment.

Antonio Olivero