Distressed debt giant Cerberus raises €4.5bn to buy bad loans

US private equity this month agreed deal to acquire a €1bn portfolio from AIB

Cerberus earlier this month agreed to buy a €1 billion portfolio, consisting of 2,200 customer loans, from AIB

Cerberus earlier this month agreed to buy a €1 billion portfolio, consisting of 2,200 customer loans, from AIB

 

Cerberus, the US distressed debt giant that recently acquired a €1 billion portfolio of non-performing loans from AIB, has raised $5.1 billion (€4.53 billion) to buy more bad loans.

The private equity group has been the leading buyer of European non-performing loan portfolios, having invested about $15 billion in equity since 2013.

Overall, the vulture fund, which has its headquarters in New York, has executed more than 215 non-performing loan transactions across 17 countries, with a total transaction size of more than $65 billion.

The group, which has also previously acquired distressed loan books from Ulster Bank, Permanent TSB and the National Asset Management Agency (Nama), said it had raised $5.1 billion, split between a $4.1 billion fund and a further $1 billion in managed accounts.

The company had originally been targeting €3.5 billion in commitments.

Global opportunities

Cerberus said the global non-performing loans opportunity represents a multi-trillion-dollar market with attractive investment opportunities.

“In addition to significant opportunities in Europe, Cerberus believes there are compelling long-term opportunities to invest in non-performing loan portfolios in other parts of the world, including China, India and Brazil,” the company said.

Cerberus, founded in 1992, has about $39 billion in assets. The company earlier this month agreed to buy a €1 billion portfolio, consisting of 2,200 customer loans, from AIB via Everyday Finance and affiliates of Cerberus Capital Management.

The portfolio is predominantly made up of investment properties, with an average balance of €500,000 across 5,000 assets.