According to sources with knowledge of the bidding, the competitors running for trading the real estate and asset load of Sareb (Spain’s bad bank) will possibly have to pay around €1 billion for one of the management contracts. The process is at the verge of closing.
The calculous, though, is only an extrapolation of the €196 million amount paid by Sareb for the asset commercialization to transferring entities during the first year of its lifespan. Now, the formula will be just reverse. The funds will be the ones to pay a prime to the bad bank initially, and earn some juicy sales commissions afterwards.
Sareb will sign the service providing contracts for three, five and seven years, meaning an average of €200 million per year earned from outsourcing.
In order to conduct the tender smoothly, the bad bank split the €50 billion worth of assets among ten portfolios (one for each entity which transferred its REO properties to it) and then it grouped them in four large packages, the subject of the bidders. Precisely, first portfolio contained real estate and loans of Banco de Valencia and credits to developers lent by Bankia. The second comprised repossessed properties of Catalunya Banc, BMN and Caja3. Next one those of Novagalicia and Liberbank. And the last again included Bankia’s loans, apart from an asset load inherited from Banco Gallego and Ceiss.
At the moment, Apollo, that purchased a 85% stake in Banco Santander’s Altamira for €664 million, and Texas Pacific Group (TPG), which acquired 51% in Servihabitat for €158 million from CaixaBank, are said to be the favorites. However, also Haya, the platform set up by fund Cerberus, has got a considerable chance of being the chosen one as it currently manages a part of properties and loans of Bankia.
Furthermore, Centerbridge could be awarded the second portfolio given that it bought the real estate servicer of BMN, while the last could end up in hands of Solvia for its experience and magnificent results in administering the REO assets of Banco Gallego. The rest of the bidders, Blackstone, Abanca and Ceiss, have lost in importance in the final stretch.
Original article: Cinco Días (by Juande Portillo & Ángeles Gonzalo Alconada)
Translation: AURA REE