Tag: distressed assets

Popular Puts €500M Distressed Asset Portfolio Up For Sale

21 April 2017 – El Mundo

Banco Popular, the Spanish entity that is under the most pressure from the ECB to accelerate the cleanup of its balance sheet, is starting to debut on the wholesale market, in search of investors interested in its portfolios of distressed assets. The entity has committed to eliminating €15,000 million from its balance sheet by 2018, which represents almost half of its total risk.

The latest move has been to put a portfolio of distressed assets up for sale, amounting to €500 million. The portfolio is sparking potential interest amongst funds that specialise in buying portfolios at low prices to generate returns from them later through the recovery of their value or their resale. Banco Popular told this newspaper that it does not have any portfolios of that kind up for sale and that it only publicises such operations once they have been completed, however, two financial sources consulted separately, confirmed otherwise.

The portfolio up for sale is the largest, by volume, that the entity has marketed since it began its timid cleanup process at the end of 2016. In January, whilst the entity’s former Chairman was in the middle of being replaced, Popular sold a portfolio of debt, amounting to €200 million and secured by hotel assets. It also placed a €400 million portfolio, secured by homes, parking spaces and storerooms. The purchasers in those cases were the investment funds Apollo and Blackstone, respectively.

The sense in the financial markets is that this move by Banco Popular will be the first of many whereby the entity will try to offload new portfolios of assets in order to fulfil the “ambitious and realistic” strategies that the regulators have been requiring of it since 20 March to clean up its balance sheet and achieve the established capital and risk coverage ratios.

Changes in the sector

In fact, Popular is far from the only entity to be placing portfolios of this kind on the market. So far this year, entities such as Bankia, Sabadell, Deutsche Bank and BBVA have placed €1,600 million with specialist funds such as Blackstone, Grove and Oaktree. (…).

Original story: El Mundo (by César Urrutia)

Translation: Carmel Drake

Project Traveler: Sabadell Sells €364M NPL Portfolio To Bain

29 December 2016 – Vozpópuli

The fund Bain Capital Credit (formerly Sankaty) is consolidating its presence in the financial-real estate sector with its fourth acquisition this year. Within the last few days, the investor, which is one of the largest private equity funds in the world, has acquired a portfolio from Banco Sabadell: Project Traveler contains debt relating to 60 developments and hotels worth €364 million.

The entity chaired by Josep Oliu has received around €150 million from this operation, according to financial sources consulted. As such, Sabadell has removed some more non-strategic assets from its balance sheet, which were consuming capital and provisions. This bank is one of the most active in these types of sales as it continues to clean up its balance sheet.

With this acquisition, Bain Capital Credit brings to an end a record year for investment in Spain. The fund has been awarded four large banking portfolios (two from Sabadell, one from Cajamar and one from Bankia) with a combined value of €1,510 million. Given that the banks are selling their real estate debt at prices of between 0.3 and 0.4 times the nominal value, Bain must have spent more than €500 million on these purchases.

As such, the US fund has placed itself amongst the major players in the market for the purchase of distressed assets (those close to bankruptcy) from the banks, alongside Blackstone, Apollo, Goldman Sachs, Cerberus, Oaktree and Deutsche Bank.

“We continue to see Spain as one of the most attractive markets in Europe. We see potential for future investments in the south of Europe, particularly in the real estate sector and the field of unpaid loans”, said Fabio Longo, Director General and Head of European Business at Bain Capital Credit for the real estate sector and doubtful debt.

The other portfolio Bain purchased from Sabadell contained non-performing loans to property developers, with a nominal value of €415 million. Cajamar sold Bain a package of loans worth €511 million, with the special feature that they were all loans to real estate companies that had filed for bankruptcy. Meanwhile, Bankia awarded Bain a batch of 2,500 homes with a combined appraisal value of €220 million. (…).

Copernicus provided financial advisory in this transaction; Aura REE, CBRE, Horwath and Cushman & Wakefield were the real estate valuations providers; Allen & Overy was the legal advisor.

Original story: Vozpópuli (by Jorge Zuloaga)

Translation: Carmel Drake

Park Street Advisors Pulls Out Of Husa Rescue Plan

9 May 2016 – Expansión

Park Street Advisors, the London fund specialising in distressed assets, which was going to come to Husa’s rescue, has got cold feet. The group has ruled out the possibility of developing the agreement that it had reached with the Gaspart family to create a joint venture to take control of the parent company, Chain, and inject €1.5 million to ensure its continuity.

Sources close to the company owned by the Gaspart family have confirmed that “this operation will not go ahead”, although “they do not rule out possible future collaborations”.

The agreement with Park Street was announced in January last year, when Husa tried to convince its creditors to approve an agreement that proposed a discount of 95% on its €221 million debt. In exchange, the company committed to return €5 million over the next five years, thanks to the agreement with Park Street, and whereby ensure the continuity of the business that has maintained the group.

Joan Gaspart (pictured above) managed to obtain approval for the agreement from the group’s four main companies last summer; the others filed for liquidation. Over the last few months, they have been filing for bankruptcy, with a view to liquidating some of the other small companies, such as Husa Service Hostelería, which recently suspended its payments in Commercial Court number 3 in Barcelona.

Last summer, the agreement with the Treasury and Social Security, to whom Husa still owes €20 million, remained pending.

Although that matter has still not be resolved, the official of Commercial Court number 3 in Barcelona raised preliminary protective measures under which all of Husa’s companies would remain active.

In its heyday in 2007, the chain owned by the former President of FC Barcelona and the President of Tourism in Barcelona, managed around 200 assets, of which around 140 were hotels and the rest were restaurants. The chain currently operates twelve hotels in Spain and Belgium.

But not all of the business was lost. In recent years, prior to the creditors’ bankruptcy, the Gaspart family transferred some of the hotels that it operated, mainly those that worked the best, to another family company called Atiram, which is run by Joan Gaspart’s daughter, María Gaspart Bueno, as the sole director.

Original story: Expansión (by Marisa Anglés)

Translation: Carmel Drake