General Electric Co., poised to exit the bulk of its lending business, is working with Deutsche Bank AG to sell the GE Capital Interbanca unit in Italy, according to people with knowledge of the discussions.
Interbanca, which offers leasing and factoring services to small and medium-sized companies, may fetch as much as 1 billion euros ($1.1 billion), said one of the people, who asked not to be identified because the planning is private. Investors including Apollo Global Management LLC and Centerbridge Partners LP are considering bids, two people said.
Deutsche Bank’s involvement shows the quickening pace of GE Capital divestitures as Chief Executive Officer Jeffrey Immelt refocuses on GE’s industrial operations. Immelt said last week his target of unloading $200 billion of assets will be largely met next year, beating a previous goal of 2017.
For Interbanca, a sale may see the lender change owners for the third time in less than a decade: Fairfield, Connecticut-based GE agreed to acquire the company in 2008 from Banco Santander SA just months after the Spanish lender had bought the business. Its assets at the end of 2014 were about 4.4 billion euros, or $5.3 billion at the time, according to a company filing.
Representatives for GE and Deutsche Bank declined to comment about Interbanca, while officials for Apollo and Centerbridge didn’t immediately respond to requests for comment.
Immelt said last week that GE expects to reach deals to sell as much as $30 billion of assets by the end of June.
Talks are under way with Element Financial Corp. for some or all of GE Capital’s $9 billion fleet-management business, people familiar with the matter said this week. GE also is looking to sell its private equity sponsor business, which has drawn interest from companies such as Apollo and Ares Management LP, people said last month.
Interbanca is boosting lending while provisioning for bad loans fell last year as Italy exits the country’s longest recession on record. Moody’s Investors Service cut Interbanca’s deposit and senior debt rating to B3 from B2 last month, saying the business “remains loss-making and with weak asset quality.”
The unit’s loss narrowed to 16 million euros last year from 119 million euros in 2013, its annual accounts show. The business had a net worth of 1.1 billion euros at the end of 2014, almost twice the year earlier amount, the accounts show, after a 550 million euro injection from its owner.