Commerzbank Spain Loans Said to Get Bids Over $4.2 Billion
Commerzbank AG (CBK)’s Spanish real estate loans are attracting offers of more than 3 billion euros ($4.2 billion), two people with knowledge of the matter said.
Investors including Lone Star Funds and Blackstone Group LP (BX) are expected to have until April 5 to submit final bids for the loans secured by Spanish property, said the people, who asked not to be identified because the information isn’t public.
The loans have a face value of more than 4 billion euros and Frankfurt-based Commerzbank is trying to sell the portfolio, named Project Octopus, before June 30, according to the people.
Germany’s second-largest bank is winding down its real estate financing arm and selling loans to focus on business and consumer banking after it received an 18.2 billion-euro bailout in 2009 from the German government, which now owns a 17 percent stake. Commerzbank’s shares have more than doubled from a July 2013 trough on speculation that the bank is getting a grip on its finances after five capital increases in four years.
Lone Star is bidding with JPMorgan Chase & Co. (JPM) for the Octopus loans, while Blackstone is paired with Deutsche Bank AG (DBK), and Apollo Global Management LLC (APO) is teaming with Banco Santander SA (SAN), the people said. Spokesmen for JPMorgan, Blackstone, Deutsche Bank, Lone Star, Apollo and Santander all declined to comment. Nils Happich, a spokesman for Commerzbank, also declined to comment.
Commerzbank’s commercial-property loans in Spain, which are both performing and nonperforming, totaled 4.8 billion euros at the end of December, according to the bank’s fourth-quarter results. Commerzbank sold 5 billion euros of U.K. property loans to Wells Fargo & Co. and Lone Star in July at a 3.5 percent discount to book value.
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