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Fortress Investment to Acquire Italian NPLs from UniCredit
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In order to further expand its Italian non-performing loan (NPLs) portfolio, Fortress Investment Group LLC (FIG - Free Report) announced a deal to acquire a large part of a €17.7 billion ($18.4 billion) worth NPLs from UniCredit S.p.A. Upon closure, the transaction will be the biggest NPL deal in Europe.
The deal has been announced at the time when Italian financial system is under pressure from the European Central Bank and local government to divest delinquent assets owing to the concerns related to the failure of weak lenders.
For Fortress Investment, the transaction is in sync with its strategy to build upon its history of purchasing Italian NPLs. The company, since 2000, has acquired nearly €22 billion of NPLs in Italy (excluding the current deal).
Fortress Investment started investing in Italian loans and loan servicing since 2000, with its investment in Italfondiario S.p.A. (“Italfondiario”). Other major investments by the company include acquisition of €13 billion in NPLs from Intesa Sanpaolo SpA in 2005 and the buyout of UniCredit Credit Management Bank S.p.A. (now renamed “doBank S.p.A”) in 2015.
Notably, by merging doBank with Italfondiario, Fortress Investment created the largest independent special servicer in Italy. As of Jun 30, 2016, the combined firm had around €83 billion of loans under management.
Along with Fortress Investment, several other private equity firms such as The Blackstone Group L.P. (BX - Free Report) , KKR & Co. L.P. (KKR - Free Report) and Apollo Global Management, LLC (APO - Free Report) are ramping up their credit business in Europe, with a gradual recovery in economy. Per a report from KPMG LLP in October, banks in Europe have about $1.3 trillion of bad loans.
The latest move by Fortress Investment seems a well-timed investment in an almost bottomed-out market, which is on its way to recovery. The deal will not only make the servicing of loans easier for the company, but also help broaden its footprint and build a diversified platform.
Further, Fortress Investment’s shares have gained 14.4% over the last six months, outpacing the Zacks categorized Investment Management industry’s growth of 10.5%.
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Fortress Investment to Acquire Italian NPLs from UniCredit
In order to further expand its Italian non-performing loan (NPLs) portfolio, Fortress Investment Group LLC (FIG - Free Report) announced a deal to acquire a large part of a €17.7 billion ($18.4 billion) worth NPLs from UniCredit S.p.A. Upon closure, the transaction will be the biggest NPL deal in Europe.
The deal has been announced at the time when Italian financial system is under pressure from the European Central Bank and local government to divest delinquent assets owing to the concerns related to the failure of weak lenders.
For Fortress Investment, the transaction is in sync with its strategy to build upon its history of purchasing Italian NPLs. The company, since 2000, has acquired nearly €22 billion of NPLs in Italy (excluding the current deal).
Fortress Investment started investing in Italian loans and loan servicing since 2000, with its investment in Italfondiario S.p.A. (“Italfondiario”). Other major investments by the company include acquisition of €13 billion in NPLs from Intesa Sanpaolo SpA in 2005 and the buyout of UniCredit Credit Management Bank S.p.A. (now renamed “doBank S.p.A”) in 2015.
Notably, by merging doBank with Italfondiario, Fortress Investment created the largest independent special servicer in Italy. As of Jun 30, 2016, the combined firm had around €83 billion of loans under management.
Along with Fortress Investment, several other private equity firms such as The Blackstone Group L.P. (BX - Free Report) , KKR & Co. L.P. (KKR - Free Report) and Apollo Global Management, LLC (APO - Free Report) are ramping up their credit business in Europe, with a gradual recovery in economy. Per a report from KPMG LLP in October, banks in Europe have about $1.3 trillion of bad loans.
The latest move by Fortress Investment seems a well-timed investment in an almost bottomed-out market, which is on its way to recovery. The deal will not only make the servicing of loans easier for the company, but also help broaden its footprint and build a diversified platform.
Further, Fortress Investment’s shares have gained 14.4% over the last six months, outpacing the Zacks categorized Investment Management industry’s growth of 10.5%.
Currently, Fortress Investment carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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