25 March, Il Sole 24 Ore
The final offer will come in April. It concerns the acquisition of 51% of the NPL management platform of Intesa Sanpaolo and of a stock equal to 10.8 billion of gross bad loans.
The operation the Swedish Lindorff Intrum Iustitia is working on is valued one billion euro. The company has just finished the due diligence through its servicer Caf (acquired last year), and it’s currently working on two fronts: the funding of the operation and the search for equity.
The operation is complex. The funding part would be the easiest for Intrum. The American commercial bank Goldman Sachs and Mediobanca are the consultants along with the legal firm Rcc. They are the main candidates for arranging the requested funding, to syndicate with other banks at a later moment.
Hence, the funding part seems not so difficult to solve, as it will just require negotiating the price with banks. The most difficult part is finding the equity.
At the moment, Intrum is currently negotiating, supported by Goldman Sachs and Mediobanca, with four possible investors. The most likely name is the fund Crc, but there should be also a Canadian retirement fund.
Governance is still one of the main issues, as it will have to be subscribed by Intrum together with its potential partner. In fact, no investor will invest its money on an operation like this without participating also in the governance.
Moreover, the operation is a run against time. Generally, far smaller NPL portfolios require double the time to arrive at a final evaluation. In this case, the consultants and the advisors, together with Intrum, have already finished the due diligence and will have to come out with an offer by April, perhaps just after the Easter break. The main issue is still finding a partner, and it will be a determining element for the success of the transaction.
After all, the bank guided by Carlo Messina is carrying out its de-risking strategy: halving the bad loans, going from 52 billion gross at the end of 2017 to 26 billion.
We must say that Intrum, just created by the merger and led in Italy by Antonella Pagano, seems to be the only candidate at this stage to take the Intesa portfolio.
In fact, it seems like the interest expressed by the Chinese Cefc is gone due to some issues with the State authorities the corporation is having back in China.
Source: Il Sole 24 Ore
Translator: Cristina Ambrosi