Carlyle gets 5-year refinancing of Freeport

The US private equity firm has arranged a €172.5 million bank facility with Bank of America Merrill Lynch.

The Carlyle Group has refinanced a real estate portfolio company investment through Bank of America Merrill Lynch.

Freeport, a UK-based owner and developer of factory outlets in Europe, said the financing from Bank of America Merrill Lynch was for €172.5 million over five years and that the facility would help Freeport look for acquisitions.  

Bank of America was the original lender to Carlyle when it took over Freeport in 2007. Alongside the financing announcement, Freeport also said it had sold the Roppenheim development in Alsace, France.

In a statement, the company said: “The facility and the proceeds of the disposal will provide Freeport with funds to expand its business and generate returns by investing in other opportunities, such as through the acquisition of distressed and/or non-performing assets.”

Freeport added it would look to grow through joint venture partnerships with existing owners of outlet malls, who will benefit from Freeport’s experience and track record of managing and improving the performance of operational outlet malls across Europe.

Freeport has agreed to sell the Roppenheim site to MAB Development, the real estate development subsidiary of Rabobank. Since acquiring the 16ha 33a land plot in February 2008, Freeport won planning permission for a 250,000 square foot outlet mall and has pre-let more than 30 percent of the space to major international designer brands. 

Chief executive Iestyn Roberts said: “We have experienced growth at our existing centres and are now positioning the business for further expansion, as European economies begin to recover.”

Robert Hodges, managing director at Carlyle, said the disposal of Roppenheim allowed the firm to “crystallise” value and profit while allowing MAB Development the ability to generate its own returns by the future development of the site.

“This sale and the recently signed long term bank financing will enable us to deploy funds into opportunities around Europe and beyond, where we can create significant value,” he said.