#Balbec #Capital #race #Partners #bad #luck
Balbec Capital LP is negotiating the purchase of LX Partners’ non-performing credit portfolio, the gross value of which has been made public is 4.2 billion euros, of which four billion relate to unsecured credit (without guarantees). and another 200 million in secured credit (with guarantees).
Balbec Capital LP is negotiating the purchase of LX Partners’ non-performing credit portfolio, the gross value of which has been made public is 4.2 billion euros, of which four billion relate to credit unsecured (without guarantees) and another 200 million on credit secured (with guarantees).
This has been dubbed the largest NPL deal (Non Performing Loans) from the market.
The newspaper “Eco” reported that LX Partners decided to remove the manager Álgebra Capital from the transaction, having already chosen the buyer for the 4.2 billion euros of bad credit portfolios. At issue are problematic assets that LX Partners acquired in recent years from Portuguese banks, and which “Eco” says is a business with a net value of 200 million euros.
The buyer, according to Jornal Económico, is the Balbec fund, which had initially made a proposal only for what is called in market slang a back book (portfolio of credits) and which was excluded when the initial intention was to sell the credits and servicer Algebra.
As Económico reported, the sale of the mega non-performing portfolio was conditional on the sale of the servicer led by Bernardo Simões, Algebra Capital, and the values offered by the platform were far below what the shareholders wanted, meaning the business was at risk.
The newspaper “Eco” revealed that they would be the consortium of Cerberus, Intrum and Finsolutia; that of Carval and Whitestar; and the LCM fund (which has Link Financial as its servicer) were selected for the binding proposals phase to purchase the 4.2 billion euro non-performing business of LX Partners in Portugal. These three are out of business. Because, according to our sources, the proposal that best evaluates the non-performing portfolio (without Algebra Capital) is that of the North American fund Balbec Capital.
Candidates were invited to submit separate proposals, one for the NPL (non-performing loans) portfolio of the LX Partners fund and another for the platform that manages these assets, with the operation that was on the market being for the sale of both together.
But the candidates who reached the final stage of the competition already have servicers and the secured and unsecured credit management and recovery company, specialist in advisoryanalysis and servicing of NPL, is not attractive to candidates. This fact is related to the fact that it is a company that duplicates an activity that the three candidates already have, with the aggravating factor of being a heavy company in terms of staff, according to sources linked to the process.
The proposals for Algebra, a company that manages 4.5 billion euros in assets, fell far short of what was intended. This is the reason why the business that started in October is not yet closed and justifies the change in business model to sell the NPL portfolio without the servicer. Jornal Económico tried to contact Bernardo Simões, Partner at LX Partners and Managing Director of Algebra Capital, without success.
According to our sources, the candidates are aiming for the purchase and sale agreement to be concluded by the end of March.
At the moment, there are two more sector transactions underway, DoValue Portugal and Hipoges.
