Finansiel Stabilitet divests property company exposures

Finansiel Stabilitet, the Danish state owned company tasked with running off the assets of failed banks and credit institutions, has signed a deal to transfer 69 property companies to private investment funds affiliated with UK based Davidson Kempner European Partners LLP.

The property companies have loan and credit facility agreements totalling DKK631m.

Henrik Bjerre-Nielsen, CEO of Finansiel Stabilitet, said: “We are extremely pleased to see the divestment of this customer portfolio materialise, because it is a complex and tasking portfolio to manage. The divestment marks yet another step towards a complete close-down of customer management in Finansiel Stabilitet.”

As part of its mandate, negotiated by the state and the Private Contingency Association, representing Danish banks, Finansiel Stabilitet took over the property company exposures of Roskilde Bank, Fionia Bank, EBH Bank and Eik Bank Danmark.

A common feature of the property companies is that they were founded as limited partnerships (kommanditselskaber (K/S)) and are owned by Danish investors.

The property companies have each made direct investments, typically in commercial rental properties in different countries such as Germany, the UK, Denmark, Sweden and Finland.

Over the next couple of months, Finansiel Stabilitet will transfer management of the customer portfolio to Reviva Capital, which will manage the agreements on behalf of Davidson Kempner European Partners LLP. All borrowers and K/S investors will be contacted in due course. Finansiel Stabilitet will not be disclosing the terms of the agreement.

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