Bloomberg News

CarVal Agrees to Buy $490 Million of Lloyds Property Loans

November 28, 2012

CarVal Investors LLC, the asset- manager unit of Cargill Inc., agreed to buy 380 million euros ($490 million) of property loans from Lloyds Banking Group Plc. (LLOY)

The non-performing loans are secured against Irish and U.K. commercial real estate assets, the Minneapolis-based company said today in an e-mailed statement.

CarVal agreed to pay about 25 percent of the face value for the loans from London-based Lloyds, according to two people with knowledge of the matter, who asked not to be identified because the terms are private.

A spokeswoman at CarVal and Ian Kitts, a spokesman for Lloyds, declined to comment on the price of the transaction.

CarVal, founded by Cargill in 1987 to focus on proprietary and high-yield debt trading, has completed investments valued at more than $1 billion in performing and non-performing loans in the past two years, according to the statement.

The company’s CVI Credit Value Fund generated a 28.4 percent return in the first 10 months of the year, while the CVI Global Value Fund I and CVI Global Value Fund II returned 17.1 percent and 16 percent, respectively, according to CarVal, which manages $9 billion.

Lloyds decided two years ago to close and run down the Irish unit it acquired two years earlier as part of its 2008 takeover of HBOS Plc. The bank has taken 11.8 billion pounds ($18.9 billion) of impairment charges on Irish loans since the nation’s real-estate market collapsed four years ago, according to data compiled by Bloomberg News.

Lloyds, Britian’s biggest mortgage lender, earlier this month agreed to sell 1.5 billion pounds of Irish commercial real estate loans to Apollo Global Management LLC (APO:US) for 10 percent of face value.

To contact the reporters on this story: Patricia Kuo in London at pkuo2@bloomberg.net; Joe Brennan in Dublin at jbrennan29@bloomberg.net

To contact the editors responsible for this story: Faris Khan at fkhan33@bloomberg.net; Edward Evans at eevans3@bloomberg.net


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Companies Mentioned

  • APO
    (Apollo Global Management LLC)
    • $23.44 USD
    • 0.42
    • 1.79%
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