Fortress Finalises Its Withdrawal From Spain

17 November 2015 – Expansión

Strategy / The US fund will close the sale of Paratus to Elliott and Cabot Financial this week. It will also complete the ERE affecting more than 50% of Lico Leasing’s workforce.

The opportunistic fund Fortress is continuing its withdrawal from the Spanish financial sector. The US investor is finalising the sale of one of its financial businesses in the country, namely, Paratus, a platform that specialises in the management of problematic banking assets, which Fortress has controlled since 2009.

According to several financial sources, the sale of Paratus will be signed this week with the fund Elliott Advisors and the British group Cabot Credit Management Group, owned by JC Flowers and Encore Capital, taking ownership.

Each of the investors will take over a different part of Paratus’ business. Elliott is most interested in the real estate division and in the team. At the beginning of the sales process – known as Project Coast and advised by N+1 – Paratus held loans amounting to €152 million, secured by 866 properties; 500 homes worth just over €100 million; and a team comprising 43 professionals.

Meanwhile, Cabot is interested in acquiring the unsecured loans, which Fortress is selling for €426 million. The British group is looking to build upon its recent entry into the Spanish market, following its purchase of the Gesif platform from Elliott.

In addition to this possible sale, Fortress is also reducing its exposure to the Spanish financial sector by conducting an ERE at Lico Leasing. At the end of 2014, this subsidiary of Fortress had 130 employees. Through the restructuring, the fund has got rid of the commercial divisions of Lico Leasing, its other major financial business in Spain, which it acquired from the savings banks just one year ago; this means that it will no longer capture any new loans.

Complex operation

Fortress will continue to manage Lico Leasing’s existing portfolio and will continue to operate Geslico, its subsidiary that specialises in problem loans. That company recently integrated two of Fortress’s other companies in Spain: Auxiliar de Servicios y Cobros and Gestión de Activos de Aragón.

Fortress’s commitment to Lico Leasing was cut short due to the time required for its approval – almost two years – and by the re-opening of the credit tap by banks following the measures introduced by the ECB.

The US fund will continue with its other activities in Spain, by providing financing to companies and the real estate market.

Original story: Expansión

Translation: Carmel Drake

Cerberus & JC Flowers Negotiate With Cajamar on €350 Mn Capital Enlargement

27/06/2014 – Expansion

Spanish cooperative savings banks cross the limits. At least two huge American funds, Cerberus and JC Flowers are negotiating with Cajamar on possibility to inject €350 million in fresh capital into the entity.

Allegedly, the ampliation would reinforce the branch of Cajamar – Banco de Crédito Social Cooperativo, although the bank claims there is no relation between the two matters. The newly created credit institution associates 32 cooperative savings banks with 4 million customers, 6.500 employees and 1.350 offices.

Cajamar also denies that the funds are the only finalists at the operation, as also insurance firms like Generali and financial groups specilized in cooperatives like Rabobank and Crédit Agricole wish to present their bids. The bank says it seeks long-term investors as in short-term it does not foresee becoming listed.

Cerberus bought two servicing companies from banks, Bankia Habitat and Cimenta2 (from Cajamar itself) through its investment arm Haya Real Estate. JC Flowers at the moment is eyeing the Spanish market without any decisive movements, however it in other countries it owns Italian insurer Eurovita and a part of Northern Rock´s portfolio.

 

Original article: Expansión (by Jorge Zuloaga)

Translation: AURA REE