Banca Popolare di Bari and Cerved today signed an agreement for the development of a long-term industrial partnership for the management of non-performing loans and unlikely to pay loans (together, the "NPLs") of the BPB Group.
George Pope, Chief Executive Officer of Banca Popolare di Bari: "The agreement signed with Cerved falls within the strategic lines of the current industrial plan which, in the field of NPLs, on the one hand provides for a disposal program through securitizations with GACS ratings of which the first, for 480 million euros, already completed in 2016, and the second, for around 340 million, expected within this year. On the other hand, the specialization of internal controls for the management of more complex positions and of amounts exceeding 1,5 million and the partnership with a primary operator in the sector for positions of less than 1,5 million”.
Marco Nespolo, Chief Executive Officer of Cerved, commented: “We are pleased to support Banca Popolare di Bari in this long-term industrial partnership. The agreement allows us to further strengthen our market position in the management of non-performing loans and unlikely to pay loans, also expanding the number of subjects with whom we have strategic partnerships. The valuation of BPB's debt collection platform is in line with current market multiples and the consideration will be financed entirely with available cash."
The closing, subject to regulatory approvals and other standard conditions for similar transactions, is expected in the fourth quarter of 2017 through the purchase, at a price of 18 million euros, of the entire share capital of a newly established company which will be part of a ten-year NPL management agreement with BPB. It is expected that this company will initially manage approximately €1,1 billion of NPLs, to which will be added 75% of future flows of non-performing loans and 55% of future flows of unlikely to pay that will be generated by the BPB Group. An earn-out of up to 3 million could be added to this price based on the achievement of economic results achieved in the period up to 2021. The contract provides for variable market fees mainly connected to the actual annual collections on the assets subject to recovery activities.
For the structuring of the transaction, the BPB Group is assisted by KPMG Advisory as financial advisor, and by the RCC Law Firm for the legal aspects.
Cerved was assisted by Latham & Watkins for the legal aspects and by Pirola, Pennuto, Zei e Associati for the tax due diligence.
