NORD/LB Norddeutsche Landesbank is parting with its real estate and property development arm, selling NILEG Immobilien Holding in its entirety to the Fortress Investment Group. A contract of sale to this effect was signed in Hanover last Thursday. At the press conference that followed, Dr Jürgen Allerkamp, Member of the Board of Management of NORD/LB and Chairman of the Supervisory Board of NILEG Immobilien Holding, said that the process of selling NILEG initiated in the middle of last year, had "gone off extremely successfully".
At the end of a structured bidding procedure Fortress had won the day, Dr Allerkamp announced, coming out on top among almost 50 interested parties. The large number of bidders emphasised the attractiveness of NILEG, he said.
The factor that had swung the decision in favour of the US-based Fortress Investment Group had ultimately been its declared intention to continue the successful operations of NILEG and its associated companies in a spirit of responsibility towards clients, tenants and employees, Allerkamp emphasised. "The partnership between NORD/LB and NILEG has always been constructive and fruitful," he said. "We are therefore delighted to have found in Fortress an investor that is aware of its responsibilities and which sees NILEG as a long-term commitment and the basis for further growth. We are convinced that NILEG will continue to pursue its successful course."
Together with the holding company NILEG Immobilien Holding the buyers are also acquiring its operating subsidiaries NILEG Norddeutsche Immobiliengesellschaft mbH, Osnabrücker Wohnungsbaugesellschaft mbH (OWG), Wohnungsbau Niedersachsen GmbH (WBN) und Wohnungsgesellschaft Norden mbH (WGNorden). The deal includes, among other things, the assumption by the purchaser of all the obligations and protective provisions that NILEG Immobilien Holding entered into when it purchased OWG, WBN and WGNorden in the years 2000 and 2003. "Even after the sale, the protection of tenants will continue to be as high a priority as it is today," Allerkamp declared, alluding to speculation to the contrary that has arisen over the last few months. Job protection for the employees has also been incorporated into the contract for the sale of NILEG. According to Allerkamp, this means that the bank has succeeded in making the transfer not only commercially successful, but also equally acceptable from a social point of view.
The NILEG disposal was a consequence of NORD/LB's new business model, through which the bank was equipping itself to meet the loss of the so-called state guarantees, Allerkamp explained. The concentration on core competences was an essential component of this strategy, he said. That also entailed parting with non-strategic investments such as NILEG, which as a property and development company did not form part of the bank's core business.
Bremer Landesbank and the public-sector insurance company VGH Versicherungen will also be transferring their 10% stakes in NILEG Norddeutsche Immobiliengesellschaft to the Fortress Investment Group. Excluded from the sale are the Saxony-Anhalt state development company SALEG Sachsen-Anhaltinische Landesentwicklungsgesellschaft mbH of Magdeburg, which employs about 50 people, a number of other smaller associated companies and the facilities management company NORD/FM, which was sold to NORD/LB at the end of 2004. The deal still has to be approved by the government monopolies watchdog.