18 June 2016 – by Mike Cobb
Oaktree Capital Management’s winning bid for Nama’s projects Emerald and Ruby is to be backed by Citi group.
Oaktree Capital Management’s winning bid for Nama’s projects Emerald and Ruby is to be backed by Citi group.
It is Citi’s first major finance deal since two senior members of its team were made redundant in April.
Oaktree won the deal for the non-performing loans last week with a bid of around €800m (£633m), beating Lone Star and Cerberus and securing loans on assets in Ireland, Germany and the UK.
Citi is putting together a deal in which it will provide a €520m loan-on-loan structure for around 65% of the total purchase price. The margin on the loan is 350bps over Euribor.
The deal reaffirms Citi’s commitment to lending for the non-performing loan market despite the departure of Stuart Hoare and Tom Jackivicz, and fears that the business was moving out of large-scale lending in an effort to cut costs.
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It will be financing the two portfolios which Oaktree is understood to have bought at a discount of around 83% on the €4.7bn combined face value.
Emerald had a face value of around €2.5bn when it was launched and was secured against 236 properties, of which 80% were commercial.
Ruby, at €2.2bn, is secured against 253 properties. Of these, 115 are residential.
In 2015 Citi also financed the Sun portfolio of loans secured against 177 German properties that Oaktree bought from Commerzbank for €250m.
