Starwood Property Trust goes shopping

Starwood Property to acquire GE Capital Project Finance Debt Business for $2.56B

Starwood Property goes shopping, Stockwinners
Starwood Property goes shopping, Stockwinners

Starwood Property Trust (STWD) announced that the company has entered into a definitive agreement to acquire GE Capital’s (GE) Energy Financial Services’ Project Finance Debt Business and loan portfolio for $2.56B, including $400M of unfunded loan commitments.

The acquired business will leverage the extensive experience of the company’s affiliate, Starwood Energy Group, which specializes in comparable energy infrastructure equity investments and has executed transactions with approximately $7B in asset value since its inception in 2005.

GE’s Energy Project Finance Debt Business includes a vertically integrated platform with a seasoned leadership team and 21 full-time employees across loan origination, underwriting, capital markets and asset management.

The Loan Portfolio consists of 51 senior loans secured by energy infrastructure real assets.

The company anticipates the transaction will be accretive to core earnings.

The company expects to finance the transaction with a new secured term loan facility from MUFG with an initial advance of approximately $1.7B and committed capacity for future funding obligations in the Loan Portfolio.

The company has ample available liquidity in addition to a $600M committed acquisition facility from Credit Suisse and Citigroup Global Markets Inc. to fund the balance of the purchase price.

The completion of the acquisition is subject to the satisfaction of a number of customary conditions and is expected to close in the third quarter of 2018.

STWD closed at $22.45. GE closed at $13.16.


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This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.

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