HIG Capital makes second Italian NPL buy

HIG Capital has bought a portfolio of around €50m of non-performing loans from Italian bank Group Cassa di Risparmio di Cesena.

The private equity investor has bought at a discount in the region of 45%. The 52 loans are secured by a mixture of residential and commercial real estate, predominantly in the regions of Emilia-Romagna and Marche in northern Italy

The European Central Bank’s Comprehensive Assessment in October highlighted the shortcomings of Italian banks’ capital reserves, and many of the country’s lenders are looking to stabilise their balance sheets.

Ahmed Hamdani, managing director at HIG, said, “This marks the second NPL investment completed by HIG in Italy in the last six months. This underscores our continued focus on the Italian real estate market. We are excited about the opportunities available in Italy and pleased with our ongoing collaboration with Eidos Partners.”

HIG has made 14 real estate acquisitions since the beginning of 2013 and is targeting medium-sized transactions and non-performing loan portfolios which it can underwrite in their entirety, rather than having to take samples from larger pools and extrapolating in order reach a bid price.

Earlier this month the company appointed Riccardo Dallolio as co-head of European real estate, a role he now shares with Ahmed Hamdani. Dallolio was previously at Axa Real Estate where he was head of alternatives and special situations.

HIG’s Italian operation is led by Raffaele Legnani out of Milan and includes director Gabriele Magotti. The company has collaborated with mergers and acquisitions advisory firm Eidos Partners in the country. Together they also bought an NPL portfolio from Cassa di Risparmio di Ravenna last June.