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Middleburg Financial sells nearly 500,000 shares
Middleburg Financial Corp., which owns Middleburg Bank, sold nearly 500,000 of its shares to a powerful executive with deep roots in America's heartland.Warren Buffett? Nope.
His name is David Sokol. He's chief executive of Des Moines, Iowa-based MidAmerican Energy Holdings Co.
Ultimately, Sokol will pay $5 million for the shares, giving him ownership of 13 percent of Middleburg Financial, the largest portion by any one shareholder.
The sale is occurring in two stages. The first took place on March 31 with the sale of 196,000 shares. The second closing will take place within two business days of all regulatory conditions being met.
Earlier this year, Middleburg Financial (NASDAQ: MBRG) announced it secured $22 million in federal money through the U.S. Treasury Department's Troubled Assets Relief Program.
As part of its agreement with Treasury officials, Middleburg Financial Chairman and CEO Joseph Boling said the company had to show it could raise capital, which is one reason why it made the sale to Sokol.
“This gives us greater options as we move forward,” he said. “We are making sure we take a conservative approach to this particular market.”
Founded in 1924 as Middleburg National Bank, today the company has eight banks in Loudoun and Fairfax counties and Warrenton. In 2008, it reported $2.6 million in net income, off 15 percent from 2007. Boling said the company's loans grew in 2008.
The company is currently trading at about $12 a share, more than half off its 52-week high of $25 a share.
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