FINANCE: Cerberus Capital Management has beaten two rivals to buy the £536m Project Avon UK commercial loan book from Lloyds Banking Group.
The US private equity firm beat bids from Kennedy Wilson and Oaktree Capital Management to secure the real estate loans for around £352m – a discount of close to 34%.
Last week the bank had sold a £93.5m tranche of six loans backed by five UK high-tech fire control centres to Kennedy Wilson.
In a stock exchange statement Lloyds said: “The transaction is part of the group’s continued non-core run-off portfolio asset reduction programme.
“The gross assets subject to the transaction are valued at £536m and generated a loss of £17m in the year to 31 December 2013.
“The sale proceeds will be used for general corporate purposes and the transaction is not expected to have a material impact on the group, including on its capital position, due to existing provisions taken against these assets.”
The transaction is expected to complete in the second half of 2014.
bridget.oconnell@estatesgazette.com
