GE Capital, the finance arm of General Electric Company (GE), has recently inked a definitive agreement with Deutsche Bank AG’s (DB) subsidiary Deutsche Postbank to acquire a $2.3 billion commercial loan portfolio. The strategic move is in sync with GE Capital’s plans to expand its core commercial real estate lending business across the globe.
The loans are collateralized by commercial properties such as offices, shops and hotels; about 90% of which are located in prime locations in the U.K. including central London. The remainder of the secured properties is located in Germany and France.
The transaction is expected to close by the end of the current year. The deal reveals GE Capital’s ability to underwrite property loans and strengthen its position in the market as a leading worldwide provider of commercial financing.
Equipped with diverse type of products, ranging from consumer lending to financial solutions, GE Capital meets the financial needs of businesses of all sizes. The segment includes General Electric’s Commercial Lending and Leasing, Consumer, Real Estate, Energy Financial Services and GE Capital Aviation Services businesses and General Electric Capital Corporation Corporate.
Commercial Lending and Leasing provides customer specific financing solutions to aid them in their operations, growth and restructuring. This business division serves customers ranging from small businesses to Fortune 100 companies. Real Estate Financing provides real estate lending, equity capital, asset management and investment management in 31 countries across North America, Europe and Asia. Currently, GE Capital Real Estate manages a portfolio of $40 billion worth of global assets.
General Electric, the parent company, is one of the largest and the most diversified technology and financial services corporations in the world. With products and services ranging from aircraft engines, power generation, water processing, and security technology to medical imaging, business and consumer financing, media content, and industrial products, the company serves over 100 million customers worldwide. Its segments include Power & Water, Oil & Gas, Energy Management, Aviation, Healthcare, Transportation, Home & Business Solutions, and GE Capital.
General Electric presently retains a Zacks Rank #3 (Hold). Other companies in the industry worth mentioning include ITT Corp. (ITT) and Flowserve Corp. (FLS), both carrying a Zacks Rank #2 (Buy).
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