UPDATE 3-Nat City nears investment of $6bln-$7bln - source

lunes 21 de abril de 2008 04:34 CEST
 

(Recasts, adds per share value in third paragraph)

By Megan Davies

NEW YORK, April 20 (Reuters) - Subprime mortgage-hit National City NCC.N, a large U.S. Midwest regional bank, is close to getting a $6-$7 billion injection from a group of investors led by private equity firm Corsair Capital, a source familiar with the transaction said on Sunday.

National City racked up losses of more than $300 million in the fourth quarter of 2007 due to its exposure to risky mortgage assets and said earlier this month it was exploring strategic alternatives.

Under the plan, the investors would pay about $5 a share for the stake, the source said, a 40 percent discount to the company's Friday closing price of $8.33. The stock was trading above $37 a year ago.

Such a deal would likely see the investors -- which number more than a dozen names -- end up with a stake of around 50 percent in Cleveland-based National City, with Corsair owning around 9.9 percent, the source said.

The company would continue to be publicly traded following the deal, the source said.

If a deal is struck, it could be announced as early as Monday, the source said.

The deal would likely see National City add a director to its board -- Corsair's Vice Chairman Richard Thornburgh, the source said. There would be no imminent management changes apart from the additional board seat, the source said.   Continuación...