Cerberus, Intrum & DoBank Bid to Acquire Altamira

15 November 2018 – El Confidencial

There is still an appetite for the servicers’ business. The sale of the 85% stake that Apollo owns in Altamira is making its first cut of candidates, with some of the most high profile investors in the segment amongst the finalists. According to financial sources, the fund Cerberus (Haya Real Estate), the Swedish firm Intrum (Nordic Capital) and the Italian firm DoBank (Fortress) are the candidates that have progressed in the process, which is being coordinated by Goldman Sachs, and which was relaunched after the summer following months on the table.

Other players in the sector interested in Spain are also in the process, both at the domestic and European level. One of those new candidates is the US firm Davidson Kempner, which has a portfolio of USD 30 billion under management and with interests in the transformation of toxic assets in the United Kingdom and Ireland, according to sources involved in the operation.

Apollo is willing to take advantage of the hunger for this type of vehicle to make gains, although it does so after four years at the helm of the servicer and having not been awarded any of the large real estate portfolios that the banks have sold (Santander to Blackstone, BBVA to Cerberus, CaixaBank to Lone Star and the Sabadell-Solvia process, in whose final stretch it is not participating). In fact, this divestment comes after Apollo’s manager for the last few years – Andrés Rubio – left the fund.

The price of the management platform could reach €1.5 billion (debt included), a business for which Apollo paid €664 million in January 2014 in exchange for an 85% stake (the remaining 15% is still owned by Banco Santander). The agreement comprised the management of toxic assets (recovery of loans and sale of properties) until 2028, although the transformation of that perimeter has led to a change in the management conditions (commissions) and to the repayment of a €200 million dividend.

Altamira has assets under management amounting to more than €50 billion, compared with €26 billion in 2014, and a portfolio comprising more than 82,000 properties at the end of 2017, making it the largest servicer in operation in Spain. In addition to its contract with Santander, it also manages assets for Sareb (which account for 30% of its portfolio) and for third parties – international investors, financial institutions, family offices and institutional clients – as a result of the international expansion plan launched in 2017.

Original story: El Confidencial (by Carlos Hernanz)

Translation: Carmel Drake

Merlin’s Share Price Rises For 10 Consecutive Days

11 August 2015 – Expansión

Merlin’s share price has increased by 14% since 27 July, taking the gain in the Socimi’s share price for the year to 35%, just behind Hispania.

Merlin Properties has achieved an unprecedented milestone in its short life on the stock market. For the first time since its debut in June 2014, the largest Socimi on the stock exchange by market capitalisation has recorded ten consecutive trading sessions of share price rises. As such, the share price now sits just below its historical peak; and the naysayers who forecast that the share price was certain to fall have been forced to abruptly exit their positions.

The real estate company’s share price has soared from €9.50 to €10.81 since 27 July. This 13.8% increase first began to take root before the company closed its recent capital increase; and has only strengthened further following the completion of that operation. Merlin raised €1,033 million from its capital increase and will use the proceeds to finance part of its purchase of Testa, the real estate subsidiary of Sacyr.

Just like in the case of the recent capital increase completed by the other large Socimi in the market, Hispania, investors were eager to snap up Merlin’s new shares. Demand for the capital increase exceeded supply by 8 times and the new shares will begin trading tomorrow, Wednesday 12 August. (…).

The strong rally over the last 10 days puts an end to the “correction” that Merlin’s share price has suffered since it peaked in April at €11.22 per share. The share price subsequently fell below the €10 mark in June…in response to the company’s announcement that it had agreed to purchase Testa, in a high-flying operation that will turn Merlin into the largest real estate company in Spain, with assets of around €5,000 million.

The size of that transaction and the capital increase fired up the appetite of the most speculative hedge funds, which have spent the summer predicting that Merlin’s shares would pay the price for the size of its purchasing offensive. (…).

However, they have been caught on the back foot by the significant increases in the share price in recent trading sessions and so have had to exit their positions quickly. They have repurchased shares in the market, which sources say explain most of the sharp rises seen in recent days. The successful completion of the recent capital increase has only exacerbated that trend.

Cicogne Management, Davidson Kempner, Marshall Wave and PSquared are the hedge funds that held the largest short positions in the share, which has increased in value by 35% since the beginning of the year following yesterday’s rise. It is now very close to its main rival Hispania, in what is proving to be a very busy summer for the Socimis on the stock market.

Original story: Expansión (by Enrique Utrera)

Translation: Carmel Drake