Tag: Project Goya

Project Goya: Ibercaja To Sell Loans To Oaktree For €350M

27 October 2015 – Expansión

Ibercaja continues to take steps to clean up its balance sheet as the rumour mill runs rife about mergers in the sector.

The Aragonese entity is negotiating the finishing touches on the transfer of one third of its portfolio of property developer loans to the US fund Oaktree, with a nominal value of €900 million, according to financial sources. The agreed price will amount to between €350 million and €400 million.

This will be the largest divestment undertaken by Ibercaja to date and fits within the current clean up strategy that the medium-sized entities are accelerating ahead of going public or merging next year.

The sale forms part of Project Goya, which Ibercaja put up for sale before the summer, guided by the investment bank N+1.

This portfolio comprises debt from 124 Spanish property developers and is secured by finished housing and developable land. In total, the loans are linked to almost 2,200 homes and other residential assets, primarily located in Andalucía, Madrid and Cataluña.

Goldman Sachs and Blackstone are also competing in the final stage of the process alongside Oaktree. These types of portfolios tend to be placed in the market for around one third (of their nominal value), therefore Ibercaja looks set to make a gain of €50 million more than it initially expected.

With the sale of these kinds of assets, Ibercaja is looking to fulfil two main objectives: clean up its credit portfolio and obtain resources – free up provisions – to use in its recurrent business.

Express clean-up

After Bankia, the entity led by Amado Franco is the Spanish group that has taken the most decisive strategy to divest its real estate portfolio. Both entities have launched operations to drastically reduce their real estate exposure. In the case of Bankia, this strategy is focused on Project Big Bang – comprising assets amounting to €4,800 million – for which it has so far received offers from Oaktree and Cerberus.

Meanwhile, in addition to Project Goya, Ibercaja has another project underway known as Project Kite. There it is looking to sell the majority of its foreclosed assets: 6,900 residential units, 1,300 premises and industrial warehouses and 600 plots of land, worth €800 million. (…).

For Oaktree, this operation would enable it to strengthen its strategy in Spain. The fund has already closed two large purchases in recent months, namely: the problem debt from the German bad bank, FMS, in Spain, with loans secured by hotels, such as the Arts de Barcelona hotel; and a portfolio of unpaid mortgages from Bankia.

Original story: Expansión (by Jorge Zuloaga)

Translation: Carmel Drake

Ibercaja Has 3 Portfolios Up For Sale With Assets Of €2,300M

14 July 2015 – Cinco Días

The Aragonese entity is currently managing three separate divestments

Ibercaja wants to clean up its balance sheet and diversify its business before it goes public at the end of 2016. The entity currently has real estate assets worth €2,300 million up for sale under three separate transactions. Ibercaja wants to retain its independence by listing on the stock exchange. The deadline for the presentation of non-binding offers for the portfolio known as Project Kite is this week.

Ibercaja has its mind made up. It does not want to participate in any mergers and is even less willing to be absorbed by another, larger entity. “A few years ago, they tried to include us in mergers through the SIP, but we were not at all convinced. We wanted to retain our independence and that is still our plan”, say sources at the bank when asked about a possible merger with the other medium-sized banks (such as Unicaja, BMN, Ibercaja, Kutxabank, Abanca, Liberbank, Cajamar and Bankinter). The entity chaired by Amado Franco plans to go public at the end of 2016, and it has already engaged KPMG to conduct the relevant studies with that objective in mind. The decision to go public is closely linked to the “Law on Banking Foundations”, which forces the former savings banks to go public if they do not want to be penalised with a reserve fund because their foundations control more than 50% of their capital. The ECB is also putting pressure on these entities to list and or/merge.

One of the main objectives of Ibercaja’s strategic plan for 2015-2017 is the divestment of unprofitable assets. A few days ago, it sold a portfolio of non-performing loans amounting to €200 million, for which it pocketed just over €10 million. Now it has out Project Goya on the market, with assets amounting to around €900 million, in the form of debt to property developers, secured by homes, according to reports from Idealista.

This transaction comes just a few weeks after the entity put Project Kite on the market, which includes mortgage loans from 124 property developers, amounting to around €800 million. In fact, this week sees the deadline for interested investors to submit their non-binding offers. Moreover, during the first six months of the year, the entity sold 1,971 properties through its real estate platform, Salduvia.

Those sales were generated in a homogeneous way across the whole country. The figure represented a 12% increase on the sales recorded a year earlier and represented the divestment of 25% of the stock that the entity had for sale. These transactions have been closed with an overall discount of 4% on the appraisal value of the assets and have generated a positive result on the net book value of €6 million. Salduvia’s sales forecasts for this year stand at 4,300 homes, i.e. 75% of the stock that is currently available for sale and an increase of 20% on the sales recorded in 2014, which amounted to 3,558 units. That sales figure would represent a reduction in real estate risk of €650 million.

Original story: Cinco Días (by Ángeles Gonzalo Alconada)

Translation: Carmel Drake