GE Real Estate Italy and GE Commercial Finance Services Italy, two units of GE ("GE"), and Pirelli RE have acquired a portfolio of non-performing loans from ABN Amro's subsidiaries Banca Antonveneta and Interbanca.
GE will act as the majority partner in the operation, with Pirelli RE holding a 35% stake. The portfolio comprises mixed commercial loans with an approximate gross book value of 1 billion, the majority secured against real estate assets situated across Italy. GE Corporate Finance Bank provided bridge financing for the transaction. Pirelli RE will act as the servicer and asset manager for the loan portfolio. The partners have signed an exclusive mandate with Banca Antonveneta for the acquisition of additional non-performing loan portfolios expected to come to market in 2007, for a gross book value of approximately 5 billion.
This transaction represents the second acquisition by GE of non-performing loans in Italy, following the joint venture with ABN Amro and Tecnocasa in 2006 to acquire a portfolio with a total gross value of 1.8 billion from Unicredit Group.
Marcelo Horcel, Managing Director of GE Real Estate Italy, and Mustafa Mirza, Senior Managing Director of GE's NPL Business, commented:
"This transaction is a great example of the growth of GE in Italy in the financial services sector and further enhances GE's position as one of leading investors in non-performing loan portfolios, following the first acquisition in the spring of 2006. We are constantly seeking opportunities to increase our presence in the country and diversify our portfolio. As more Italian financial institutions look to dispose of their non-performing assets, we look forward to completing further transactions such as this in the future. For both the real estate and the commercial lending divisions of GE, NPLs represent a major pillar of growth in the Italian market.
"We view Pirelli RE as a very strong partner with an impressive track record and reputation in the market and look forward to working with them on this portfolio."
Mediobanca acted as consultant to the operation, Morri e Associati advised GE, while Bonelli Erede Pappalardo acted for Pirelli RE.