EverBank Financial Corp. on Monday announced its first major deal since its initial public offering two months ago, a $2.51 billion acquisition of a commercial real estate loan business from General Electric Co.
Jacksonville-based EverBank is buying the GE unit called Business Property Lending Inc., which originates and services commercial real estate loans on properties leased by small and midsized businesses. The business has 14 offices around the country.
“I think this is a great fit for us and we’re very excited to get to this point,” EverBank Chairman and CEO Rob Clements said in an interview.
The deal includes a portfolio of about $2.44 billion in commercial loans, servicing rights on $3.1 billion in loans securitized by GE Capital Real Estate and 108 employees.
EverBank plans to keep the management team and grow the business, which will be called EverBank Business Property Lending.
“The portfolio acquired is very attractive but we’re equally if not more excited about bringing on
this new lending group,” Clements said.
He said the acquisition might result in a “modest” increase in employment at EverBank’s Jacksonville headquarters to provide corporate support, but it will have a bigger impact on the company’s operations longer term.
“As we continue to grow, we’ll continue to add employees here in Jacksonville,” Clements said.
The acquisition, which is expected to be completed in the fourth quarter, would increase EverBank’s total assets from about $13.8 billion at the end of the first quarter to $16.2 billion.
EverBank also said the deal will increase its earnings per share by a low double-digit percentage.
GE Capital has been looking to sell off real estate-related businesses after incurring $32 billion in credit losses during the financial meltdown, Bloomberg News reported.
“The sale of Business Property to EverBank is a strong strategic win and is consistent with our stated strategy to reduce the overall size of our real estate portfolio,” GE Capital Real Estate, North America, President Alec Burger said in a news release.
EverBank went public two months ago by selling 22.1 million shares of stock for $10 each.
The company is funding the Business Property deal with a combination of cash on hand and existing borrowing facilities.
Clements said going public hasn’t changed much at EverBank.
“It really hasn’t had a noticeable impact on our day-to-day operations,” he said.
Newly public companies often find it difficult dealing with all the rules and regulations mandated by the Securities and Exchange Commission, but Clements said EverBank already was a heavily regulated businesses as a bank.
“So far, there hasn’t been any real material difference in how we operate,” he said.
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