US financial services firm Wells Fargo & Co (NYSE:WFC) and Lone Star Funds have inked a deal to buy the Hypothekenbank Frankfurt commercial real estate portfolio of EUR5bn (USD6.5bn) in the UK from German lender Commerzbank AG, Wells Fargo said today.
Under the terms, Wells Fargo will take EUR4bn worth of commercial real estate loans comprised of institutional assets across the UK with a focus in London. At the same time, Lone Star will acquire some EUR1.3bn of non-performing assets, while Wells Fargo will also provide the financing.
In addition, several Hypothekenbank Frankfurt employees in the UK will join Wells Fargo’s own team in London.
The transaction, the exact value of which was not given, is seen to close in the third quarter of the year.