Lone Star Funds now can lay claim to having taken part in the biggest sale of a German bank since the 2008 global financial crisis. The Dallas-based firm has sold Düsseldorfer Hypothekenbank, which specializes in commercial real estate lending and has €12 billion of assets, to OCEAN Holding, a German fund managed by Patrick Bettscheider and Attestor Capital. Bettscheider is the founder of MainFirst bank in Germany, from which he retired in February, while Attestor is a private investment firm whose investments include restructuring French water company Saur last year.
It is not the first time Lone Star has sold a German financial institution since the 2008 crisis claimed a number of scalps. In March, for example, Lone Star completed the exit of Corealcredit Bank by selling it to Germany’s Aareal Bank.
Other than naming the purchaser of Düsseldorfer Hypothekenbank, few other details have been disclosed of this latest transaction, such as the return or otherwise Lone Star has made. It is known that the firm originally acquired the German bank in 2010 via LSF5 German Investments II, registered in Delaware, and LSF5 Riverside and proceeded to make a €500 million investment in it to improve its core capital position.
Düsseldorfer Hypothekenbank focuses on domestic and international real estate investors in Germany, the Netherlands, France and Spain, concentrating on large-volume lending for commercially used or commercially operated properties. It does not lend to one-off homeowners, such as financing single-family houses and condominiums.
Law firm Paul Hastings, which advised OCEAN, said the transaction was “intended to further stabilize the bank’s core capital position through the conversion of mandatory obligations.”