By Patricia Kowsmann
Aareal Bank, a German lender exposed to U.S. commercial real estate, is selling its prized property-software unit, Aareon, to private-equity firm TPG.
The bank and one of its owners, Advent International, agreed to sell Aareon to TPG and Canadian investment group CDPQ at an enterprise value of 3.9 billion euros, the equivalent of $4.2 billion. Aareals equity stake in Aareon is valued at 2.1 billion.
Aareon was considered a valuable business for the bank, providing software that allowed property managers to handle contracts, rental payments and services across Europe.
The bank said it would lift its annual financial guidance following the Aareon sale. Aareals bonds were hit earlier this year over its exposure to U.S. commercial real estate, which forced it to set aside more money to cover for bad loans.
Advent bought a 30% stake in Aareon in 2020 for about 260 million, valuing the whole unit then at less than 900 million.
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(END) Dow Jones Newswires
June 24, 2024 06:48 ET (10:48 GMT)
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