Apollo asked for over €400 million in syndicated loan to finalize the purchase of 85% of Altamira, Santander´s property manager. The transaction was sealed at the beginning of 2014 at final price of €664 million.
Financial deleveraging is a habitual tool of opportunistic funds striving for an increase in profitability. Usually, they aim at obtaining a 20% return within a 5 year term. Obviously, such operations casts high risk that might even lead to loss of the entire investment.
Altamira Asset Management, fusion of three branches: Altamira Santander Real Estate, Reintegra and Elerco, will manage and market €8 billion worth of Santander´s assets for 12 years with an extension option.
Purchase contract assumed that Santander will re-buy a 15% stake in the real estate manager.
The operation included transfer of 500 employees from Santander to the new Altamira, although annual results mention only 272 employment agreements: 183 of Santander, 60 of Altamira Santander Real Estate, 7 of Reintegra and 22 of Elerco.
To supervise and lead the project from the position of the CEO, Apollo hired ex-executive of Citi, Julián Navarro. Andrés Rubio was named the president of the servicing firm. The two experts got a task to expand Altamira by intending €1 billion for the real estate investments. In this context, Apollo explored purchase of the portfolio of Eurohypo and is now taking part in the bidding for CatalunyaBanc´s “Hercules“.
Original article: Expansión (by J. Zuloaga)
Translation: AURA REE