Nomura International, the private equity wing of the Japanese bank Nomura, has agreed to an €800 million ($1 billion) property deal with Germany’s second largest do-it-yourself (DIY) chain.
In linked transactions, Praktiker, Germany’s second biggest home improvement group, is buying the operational assets of smaller rival Max Bahr, the country’s eighth largest chain with 76 stores.
Nomura will then acquire and lease back all 76 properties to Praktiker, which will keep a 24 percent stake in a property ownership vehicle called Moor Park Holdings Luxembourg Sarl.
Nomura refused to comment on the deal before completion. However, it marks an important milestone for the bank in Europe. In April, the Nomura revealed the creation of new strategic alternative investment funds called the European Funds Group (EFG) into which it is injecting €325 million of equity.
The first two vehicles from EFG are focusing on mezzanine finance through the European Mezzanine Fund 1 and real estate through the Real Estate Return Enhancement Fund 1. The Max Bahr properties will be owned by the real estate fund.
Gary Wilder, former head of Nomura’s asset finance group, is the head of EFG along with Santiago Corral, former head of the firm’s mezzanine business.
Wilder’s previous deals include buying London’s Earls Court and Olympia exhibition and conference centers for €370 million as part of a consortium in 2004.
Germany is currently Europe’s hotspot for property investors, but Nomura’s real estate portfolio is allocating up to 30 percent of assets to Eastern Europe.
It is focusing on corporate and government restructurings. One of the key backers of the real estate fund is a secretive UK property company which has also been active in Continental Europe.