Aareal Bank, a leading German property lender, has announced the sale of its tech unit, Aareon, to private equity firm TPG and investor CDPQ. This strategic move is expected to generate a substantial gain of approximately 2 billion euros ($2.14 billion). The sale will be finalized later this year, upon which the gain will be officially realized.
Aareal Bank, which operates globally, disclosed that it will face transaction costs of 150 million euros in the second quarter. Despite these costs, the bank reported a net profit of 73 million euros in the first quarter of the year.
Amidst a global commercial real estate downturn, Aareal Bank has been navigating challenges, particularly in the United States, where it holds a significant quarter of its business interests. The bank’s co-owner, Advent, will retain a stake in Aareon.
The decision to sell Aareon was backed by a strategic review, with advisers lined up earlier this year, as reported by Reuters in March. The transaction values Aareon at an enterprise value of 3.9 billion euros.
For the latest updates on Aareal Bank, Aareon sale, and global commercial real estate trends, stay tuned.
($1 = 0.9335 euros)
