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Bankia sells its real estate company to Cerberus for 90 million Euros.

Bankia gets rid of its excess baggage again. The bank announced yesterday the sale of the business of management and commercialization of real estate assets and developer credit to the U.S. fund Cerberus. The operation, channeled through its subsidiary Bankia Habitat has been closed for an amount between 40 and 90 million Euros, depending on the evolution of the business plan designed by the new owner without any earnings for Bankia.

The price is divided between a fixed part (40 million Euros) and another variable one that will depend on the volume of sales of assets achieved by Cerberus. If the business plan is complied with, it will be possible to attain the 90 million Euros. If the fund sells more assets than estimated in the project, it will pay Bankia an amount over 90 million Euros.

The operation is relevant for the bank presided over by José Ignacio Goirigolzarri as, even though there are no earnings, it will save labor costs and advanced in its restructuring plan.

Cerberus will keep the 457 employees assigned to this activity. The exit of these workers allows the Dismissal Program to be lower.

Cerberus has created the company Promontoria Plataforma, which acquires the assets and liabilities linked to the management of properties carried out by Bankia through Bankia Habitat, Gesnova and Reser Subastas, participated in 55% and 50%, respectively.

The ownership of the assets and the developer credit is still in the hands of Bankia. Cerberus will therefore manage the assets included in the balance sheet of Bankia-BFA for 12.200 million Euros during ten years. It will also acquire the management of the assets that Bankia has transferred to third parties (Sareb, the bad bank) for 36.600 million Euros.

Bankia has been advised by KPMG and Uría, while Cerberus has had Oliver Wyman and the firm Ashurst and Schulte Roth & Zabel.