Property Week - January 6, 2009
Italian bank UniCredit has packaged a portfolio of domestic real estate, including its Milan headquarters, into a fund and sold 62% of the units to institutional investors.
The fifteen year investment fund, managed by Italian real estate manager Fimit, comprises a portfolio of the bank’s historic Palazzo Broggi building in the heart of Milan (pictured) and Livio Cambi in the city, as well as 70 banking branches and has an overall value of €800m.
UniCredit, which will lease the properties back for 18 years, will keep a 33% stake in the remaining fund units and sell a further 5% by February.
Italy’s second largest bank is under to pressure to boost its core tier one capital ratio – a key measure of balance sheet strength – to 6.7% before the end of the year.
The deal is expected to yield UniCredit a €280m profit for the fourth quarter of 2008. In the three months to September, net profit at the bank fell 54% to €551m compared with the same period last year, but beat market forecasts of €425m.
The sale is one of three disposals worth just over €2bn for the bank. It has also raised €1bn from the sale of profit sharing rights by UniCredit’s Bank Austria for €1.1bn and a stake in Atlantia, an Italian highway tolls operator, for €248m.
In October UniCredit said it needed to raise €6.6bn in additional capital through scrapping its cash dividend and tapping shareholders for extra cash.
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