German-listed residential firm Adler Real Estate has created a joint venture with Benson Elliot Capital Management to dispose of around €115 mln of non-core assets.
The value represents a premium of around 5% to the assets' current book value. Benson Elliot is set to acquire a majority stake in the joint venture, while Adler will retain a substantial minority participation.
'We are particularly pleased with such a collaboration,' said Tomas de Vargas Machuca, co-CEO of Adler, 'as it would allow us to divest our non-core portfolio at a premium and retain upside potential with the planned disposal from the joint venture.
Benson Elliot has a strong track record in this field and is an internationally renowned private equity firm with whom we have worked very well in the past,' added Machuca. 'Furthermore, part of the proceeds will be used for net debt repayment and thus continue to expedite our LTV reduction in order to improve our current rating and achieve investment grade as soon as possible.'
Adler will cover the roles of asset, property and facility manager until the assets are ultimately sold to third parties. The residential specialist said it expected to participate in any upside deriving from future disposals undertaken by the joint venture.
The parties expect to enter into a definitive agreement within the upcoming weeks upon completion of a customary due diligence process and subject to final documentation.