Cerberus Capital Management, Kennedy Wilson and Forum Partners are all in the running to buy Lloyds Banking Group’s €360m (£292m) portfolio of Irish property loans.
The investment firms are all understood to have tabled first-round bids for the portfolio of Irish office and retail debt, codenamed Project Prince.
The bidders are completing due diligence on the portfolio ahead of a deadline for second-round bids within the next two weeks.
Cerberus, the New York-based private equity firm, came second to Lone Star in the competition to buy Lloyds’ £900m UK loan book Project Royal, which was sold last December.
In that process, Cerberus worked with loan servicer Hatfield Philips, which is owned by one of Cerberus’s part-owned subsidiaries, LNP Partners.
Kennedy Wilson has already made a number of investments in Ireland, buying a $1.8bn (£1.1bn) UK property loan book from Bank of Ireland last year at a discount of about 20% to par value.
Deutsche Bank provided both debt and equity for that deal and is expected to be involved in its Project Prince bid.
The bid by Forum Partners follows its appointment of former National Asset Management Agency executive Enda Farrell as a representative in Ireland to source loans and build the firm’s Irish loan servicing platform.
Other parties, including Lone Star and a joint venture between TPG and Green Property, looked at the loans before deciding against bidding.
Offers for the portfolio, which is a combination of loans Lloyds took on when it acquired HBOS, are expected to come in at a discount of 70% to face value.
Expectations are growing that Lloyds will soon bring out a second portfolio of UK loans, with a face value of about $600m, which the market is calling Project Royal II.
