State-controlled German bank WestLB is in exclusive talks to sell its real estate finance unit Westimmo to private equity investor Apollo Global Management, PropertyEU Magazine reports.
State-controlled German bank WestLB is in exclusive talks to sell its real estate finance unit Westimmo to private equity investor Apollo Global Management, PropertyEU Magazine reports.
In July, Reuters reported that WestLB had granted the buyout firm more insight into Westimmo's books without rival suitors interfering until September 30. WestLB would not comment on the date. Apollo also declined to comment, but insiders told PropertyEU that WestLB is expected to sell Westimmo at a huge discount, with the subsidiary unlikely to fetch more than EUR 250 mln.
Such a price would represent a sharp drop on last year’s value, when real estate analysts estimated that Westimmo would sell for between EUR 400 mln and EUR 500 mln. Most banks are trading at a huge discount to book value, Dirk Richolt, head of debt advisory services at CBRE in Germany, told PropertyEU. Westimmo’s book value is believed to stand at around EUR 600 mln.
US private equity group Blackstone is believed to have submitted a bid for Westimmo last year, although it is no longer involved in the process. Blackstone declined to comment. Wiesbaden-based Areal Bank is also believed to have bid for Westimmo. A spokesman for Aareal Bank told PropertyEU that the bank ‘is keeping a close eye on all market developments’, but declined to comment on whether Aareal Bank had submitted a bid for Westimmo.
The fulll story appears in the September edition of PropertyEU magazine.
Click on the link below to read 'Westimmo's new lending business down 78% in H1'
