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GE sells fleet business including NZ

General Electric lifted its selldown to $US63 billion in 3 months when it announced the disposal of vehicle fleet finance & management businesses in 4 countries yesterday.

The Australian & New Zealand part of the deal makes up about 25% of the business sold to Element Financial Corp of Canada for $US6.9 billion. Element bought GE’s Canadian fleet business in 2013. This time it’s also bought GE’s US & Mexican fleet management businesses and has an alliance with BNP Paribas SA subsidiary Arval, which has bought the European business. The US & Mexico transaction is expected to close I the third quarter, the Australia & NZ and Arval transactions in the fourth quarter.

GE Capital Fleet Services provides commercial car & truck financing and fleet management services for over 1.5 million leased, serviced & managed vehicles around the world.

GE confirmed its return to an industrial focus on 10 April, starting 2 years of planned disposals with the sale of GE Capital Real Estate assets for $US26.5 billion, most of that to funds managed by Blackstone Group LP.

Element will increase its total assets to $C21 billion on completion of these transactions. It will finance $C2.7 billion from subscription receipts, subordinated convertible debentures & preferred shares issued on 29 May and the $C5.9 balance from an increase in its senior credit facility.

Links: GE Capital NZ fleet leasing
Custom Fleet NZ
General Electric
Element

Attribution: Company releases.

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Canadian fund buys GE Capital unit

The Canada Pension Plan Investment Board will buy Antares Capital from GE Capital for $US12 billion.

The Canadian pension fund said on Tuesday it had signed an agreement to buy the Antares loan portfolio & its management. Settlement is expected in the third quarter, subject to regulatory approvals.

Chicago-based Antares is the leading lender to middle-market private equity sponsors in the US, offering a one-stop source for lending & other services in a $US96 billion/year market. Antares has provided more than $US120 billion in financing in the last 5 years.

Pension fund president & chief executive Mark Wiseman said: “This acquisition exemplifies our strategy to achieve scale in key sectors through platform investments. It secures a market-leading business that is exceptionally well positioned to deliver value-building investment flows.”

Antares will operate as a standalone, independent business governed by its own board of directors.

The Canadian fund ended its fiscal year in March with net assets of $C264.6 billion. The $C45.5 billion increase in assets for the year consisted of $C40.6 billion in net investment income after all fund costs and $C4.9 billion in net contributions. The portfolio delivered a gross investment return of 18.7%, or 18.3% on a net basis.

General Electric confirmed its return to an industrial focus on 10 April, starting 2 years of planned disposals with the sale of GE Capital Real Estate assets for $US26.5 billion, most of that to funds managed by Blackstone Group LP.

Link: Canada Pension Plan Investment Board

Earlier story:
World property M13Apr15 – Chinese insurers buy in Boston, GE exits property

Attribution: GE & Canada fund releases.

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GE takes over Wizard

GE Money Australia & New Zealand has bought the Australian Financial Investments Group (AFIG) for about $A400 million. Its assets include the Wizard Home Loans brand & distribution network, and AMS, Australia’s largest wholesale mortgage funder.


Publishing & Broadcasting Ltd, the media company controlled by Kerry Packer, said it would make an $A58 million one-off after-tax gain this year by selling its 25%.


The other 3 shareholders were Deutsche Asset Management, ABN AMRO & State Capital Corp.


Ian Rogers, of the Melbourne-based banking newsletter The Sheet, said that based on PBL’s accounts – it was equity accounted at $A31.7 million in the company’s June accounts, giving an implied value of about $A360 million, with an equity-accounted profit from AFIG of $A7.6 million – GE paid 12 times historic earnings. The reported sale price of $A400 million put the deal at closer to 15 times 2004 earnings.


Tom Gentile, president & chief executive of GE Money Australia & New Zealand, said the acquisition gave GE an $A18 billion mortgage platform. It will take GE’s financial services assets in the 2 countries to $A38 million.


Wizard founder & executive chairman Mark Bouris will stay on as non-executive chairman and the Wizard brand name will be retained.


Australian Financial Investments Group was incorporated in December 2003 as the holding company for its 3 businesses – Wizard Home Loans (created in 1997), AFIG Wholesale and Australian Mortgage Securities (AMS).


It sources wholesale mortgage funds from domestic & international capital markets through AMS, distributes loan products through Wizard branches & AFIG Wholesale and services loans through the operations arm of AFIG Wholesale.


Websites: Wizard NZ

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