The Spanish group BBVA is to sell 80% of its property business in Spain to Cerberus Capital Management’s subsidiary with the aim of reducing BBVA’s exposure to ‘brick’.
The operation, pending of regulatory approval and expected to be closed by the second half of 2018, will entail the creation of BBVA’s joint venture with the US manager Cerberus for real estate in Spain, through which that majority stake of BBVA’s current property business will be transferred to Cerberus for some €4bn.
Once the transaction is complete, Cerberus will provide real estate management to the portfolio remaining part of BBVA.
BBVA’s real estate portfolio comprises around 78,000 real estate assets – valued approximately at €13bn – that are distributed mainly in Catalonia, Madrid and Valencia.
BBVA’s CEO Carlos Torres said: “This operation is very important for us because it significantly reduces our exposure to an activity unrelated to our core business while enables us to carry on with our transformation process.
“Through the agreement, we will benefit from Cerberus’ experience and expertise in real estate (both in management and marketing) as well as from the opportunities arising from the Spanish economy – which we hope will benefit the new company’s outcomes.”
John Snow, president of Cerberus Capital Management and former Secretary of the US Treasury, commented: “This operation proves our commitment to offer customized solutions to our partners and highlights the confidence we have in the continuing growth of the Spanish economy, in which we plan further investments.”