illimity and Apollo form JV to invest in single-name real estate-backed distressed credits in Italy
illimity Bank is to form a 50:50 joint venture (JV) with certain funds managed by Apollo Global Management (Apollo) aimed at investing up to EUR500 million in single-name distressed credit exposure secured by real estate assets in Italy.
The JV, which will have an initial investment period of two years, with an option to extend, will pursue investments in NPL and UTP loans mainly secured by real estate assets and with a single price of up to 50 million euro.
The JV, which will have illimity and Apollo as 50:50 investors and with equal governance rights, also provides for the contribution by illimity of approximately 231 million euro of gross nominal value ("Gross Book Value" or “GBV”) of loans previously purchased by illimity, which is representative of part of the current special situation real estate investment portfolio of the Bank.
The JV will see the direct involvement of illimity's Special Situations Real Estate teams and Apollo's European Principal Finance teams.
The JV has selected Neprix srl (neprix), a company of the illimity Group set up to innovate the management of distressed corporate credit, as sole special servicer for the management of the investments.
The transaction will be structured, and definitive agreements entered into, following the review of appropriate structuring considerations and subject to the satisfaction of certain customary conditions. The definitive agreements are expected to be entered into, and the transaction is expected to be completed, within the third quarter of 2021.
Andrea Clamer, Head of Distressed Credit & Servicing Division of illimity, says: “We are very proud to have entered into this 50/50 partnership with one of the main investors worldwide, which confirms illimity’s role as a primary player in the Italian non-performing loan market and its international recognition. The selection of neprix as sole special servicer accelerates the development of neprix’s third party servicing activities and is the recognition of the quality of the management of non- performing loans activities and of the success of the underlying business model”.