The relationship between Sareb and the foreign investors is a history of ups and downs. After the constitution of its initial capital without the presence of these actors, Sareb continues negotiating with them to hire them as consultants without ruling out their entrance as shareholders in the next capital increase.
The bad bank has received in the last weeks an offer of joint counseling from the funds Cerberus, Fortress and Centerbridge, according to sources close to these investors. Nevertheless, Sareb has declined the offer based on differences on the economic terms and has requested a new separate offer from all three funds. They would receive a commission for this work.
With this offer, the international investors would like to assure that the structure and strategy of the bad bank is to their liking. Cerberus, Fortress and Centerbridge proposed in December the contribution of between 150 and 200 million Euros to the capital of the bad bank, but with the condition of having the opportunity to influence its management.
This contribution would have placed them as one of the five main private shareholders of the bad bank, after Santander (660 million Euros), CaixaBank (476), Sabadell (264) and Popular (227), which have contributed with shares and subordinate debt. Above them stands the Restructuring Fund (Frob), with 44% of the capital.
At the time Sareb decided not to accept the conditions of the three foreign funds and decider to obtain this capital from insurance companies.
“It is normal that Sareb defends the interests of its main shareholders, the great Spanish banks, but at some time it will have to align its interests with foreign investors, as we will be the ones who will acquire its assets during the next 15 years”, representatives of one of the agencies declare.
The discrepancies between the bad bank and the foreign investors started after these ones asked for a seat in the Board of Directors of Sareb, a petition which was rejected by Frob.
The arrival of foreign investors is essential of the international credibility of Sareb, this is why it has hired Goldman Sachs, Citi, Barclays Capital, Nomura, Santander and N+1 in order to look for common ground with the funds. Among the offered possibilities, one is to allow the shareholders of the bad bank to have access to the information on the assets the company is planning to sale before their competition. The Government has also assured some tax benefits for the bad bank and its assets, having the intention of turning the company into a fund, in order to optimize its taxation and attract investors.
Sareb will face its acid test in a month, with the capital increase it will need to carry out in order to receive the assets from group 2 (BMN, Liberbank, España-Duero and Caja 3).
These institutions will transfer around 15.000 million Euros in properties and toxic credits, so that Sareb will end up with a volume of 52.000 million Euros. In order to increase its size so drastically, the bad bank will need to obtain around 1500 million Euros in capital, 660 million Euros of which will need to be contributed by Frob while the rest, 840 million Euros, will need to be contributed by private investors.
The three funds which have made a proposal to Sareb have a long career path in Spain.
Cerberus acquired in 2012 a portfolio of 350 million Euros in mortgage loans from Santander.
Fortress, in that same operation, acquired 1000 million Euros in consumer loans and has established its platform, Paratus AMC, in Barcelona.
Centerbridge burst in Spain at the end of last summer with one of the biggest operations of the last few months: the acquisition of Aktua, the subsidiary of Banesto for recovery of failed loans, for 90 million Euros.