Cerberus, Ifis Bid for $5 Billion Credit Agricole Loans

(Bloomberg) -- Cerberus Capital Management LP made a joint offer with Banca Ifis SpA to buy most of the 6 billion euros ($7 billion) of Italian bad loans being sold by Credit Agricole SA, according to people with knowledge of the matter.

The pair submitted a bid for a package nominally valued at 4.3 billion euros, said the people, who asked not to be identified as the transaction isn’t public. The offer was mainly for the unsecured portion of the Project Poppy portfolio, which also included secured and consumer debt as well as loans to small- and medium-sized enterprises, the people said.

Representatives for Cerberus, Ifis and Credit Agricole declined to comment.

Credit Agricole is trying to offload holdings it took on from 2006 to 2008, when its investment-banking unit purchased and securitized the loans in four different vehicles, people familiar with the situation have said. Italy’s growing economy and measures to simplify bankruptcy proceedings are resulting in more sales of non-performing loans.

Cerberus and Ifis offered to buy 2.4 billion euros of unsecured debt from the first three vehicles and 1.9 billion euros of NPLs belonging to the fourth vehicle, dubbed Elypso, said the people. Agricole is reviewing the offer to decide whether or not to give the buyers exclusive rights to the package and reopen the rest of the sale in September, one of the people said.

The Paris-based bank has extensive business in Italy, including corporate and investment banking. It expanded in the country last year with acquisitions in asset management and retail banking, while its provisions for Italian bad loans fell 22 percent.

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