US private equity firm KKR has bought a stake in an Italian loan servicing firm with a focus on real estate debt.
Sistemia, a firm which services secured and unsecured credits including non-performing loans, announced that KKR will become a shareholder of the company and will “support the growth” of its servicing platform.
The Rome-based company has been involved in Italian loan servicing for 13 years, with a strong focus on real estate. In the property debt part of its business, services include portfolio due diligence, loan analysis, pricing assistance, re-marketing of distressed assets, auction optimisation and debt collection.
“We are backing a very strong Sistemia team that has built an innovative and much-needed capability in a sector of critical importance to loan originators, investors and the wider Italian economic recovery. We have full confidence in the ability of the team to further develop Sistemia into a leading player across the whole loan to asset cycle of the NPL market,” said Dan Pietrzak, managing director at KKR Credit.
As at the end of 2016, Sistemia had €4.6 billion of assets under management, of which two thirds are secured exposures.
“With the capital support from a leading global investment firm such as KKR, we can further scale our platform to the benefit of our customers,” said Guido Fienga, chairman of Sistemia.
KKR is among several foreign investors aiming to gain a foothold in the Italian market at a time when many expect an acceleration of NPL sales. As of June 2016, PwC estimated that 21.4 percent of all loans in Italy were classed as non-performing exposures, representing a total stock of €331 billion.
In February, US-based Bain Capital Credit moved into the Italian real estate debt market with the acquisition of Heta Asset Resolution Italia, a manager of distressed loans. The purchase was part of its plan to scale its services in the country with a view to potentially originating loans in the long-term future. Heta is a bad bank established by the Austrian government to wind-down the non-performing loans on the balance sheets of Hypo Alpe Adria, now known as Harit.