Blackstone Gets Green Light in Luxembourg to Enter into Gecina

29/01/2014 – Cinco Días

On Wednesday, a judge from Luxembourg returned a verdict in favour of Blackstone and Ivanhoe interests, on the French real estate company Gecina. The enterprise is one of the biggest in Europe and the verdict harmed the interests of two powerful Spanish businessmen from the real estate sector, Joaquín Rivero and Bautista Soler.

The Luxembourger justice has stated that Blackstone and Ivanhoe (fund of Caisse de dépôt et placement du Québec) are in fact the owners of 64,7% of the businessmen´s debt called into existence by buying shares of Gecina. The two companies could execute the debt becoming Gecina´s shareholders.

Rivero and Soler hold 16,1% and 15,2% respectively. (…). They asked a sindicate of banks led by Popular (Banca Cívica, Banco CAM, Banco Castilla La Mancha, Banco Sabadell, Banco de Valencia, Banco Pastor, Bankia, Caixa General, France Eurohypo, Natixis, NCG Banco and Royal Bank of Scotland) for a loan of 2.160 millon Euros in 2006.

The companies engaged in managment of the 31%, Alteco y Mag Import, entered in the creditors´arrangements in October 2012 with more than a 1.600 millon Euro debt. (…).

As the companies could not cope with the debt execution, they sold a considerable part of those credits to Blackstone and Ivanhoe that have been buying banking debt between the end of 2012 and the beginning of 2013 until they gathered 64,7% of total debt (through a Canada-based company Blackstone Real Estate Principal Transaction Partners). The new owners sent to a judge a request in written to execute the guarantees, however they have been refused. (…).

In order to unblock the operation, the U.S. fund ran in parallel another court trial in Luxembourg (…) that resulted in success. Now their aspirations are backed legally, however some claim that the Spanish justice should make the final remark (…).

Blackstone does not aim only at acquiring shares of Gecina by guarantee exectution. The investment company also pursued an offer to buy 27% of the French real estate held by Metrovacesa. (…). Except for Blackstone, Orion y Predica of Crédit Agricole expressed interest in the said share as well. (…).

Original article: Cinco Días (Alberto Ortín Ramón)

Translation: AURA REE