HIG Capital, AnaCap Financial Partners and Deutsche Bank have bought a €495m portfolio of non-performing and sub-performing loans from Volksbank Romania.
The transaction – Romania’s largest – sees the trio take on a portfolio of 3,566 loans backed by residential, commercial real estate and development land.
For HIG’s credit affiliate, Bayside Capital, the deal is its 11th European investment since the start of last year. Last month, the company made its first non-performing loan investment in Italy, investing in a secured portfolio originated by Cassa de Risparmio di Ravenna. The loans are secured on a mix of residential and commercial real estate assets in Ravenna and Bologna.
The company, which opened a Milan office in February this year, said it continues to see significant opportunity in its target market of small and midcap opportunities with a value-added component. In January, the firm refinanced a Spanish shopping centre, providing mezzanine facility.
Private equity fund manager AnaCap said the transaction was a result of ongoing pressure on financial institutions to restructure and divest assets in order to clean up balance sheets and comply with new capital requirements.
“After a prolonged correction following the financial crisis, the property market in Romania is now showing strong signs of improvement,” AnaCap said, citing recovery in gross domestic product, falling unemployment and increasing house prices.