EverBank Financial Corporation, the Jacksonville, Florida-based financial institution which went public earlier this year, has announced it has agreed to buy Business Property Lending for $2.41 billion (£1.5 billion) in cash. General Electric, Business Property’s parent company, has been taking steps to reduce its financial division in recent years, with special emphasis being placed on its real estate loan portfolio.
Business Property is a commercial real estate lender specialising in properties purchased or leased by small and medium-sized businesses. With the acquisition of Business Property Lending, the company will take over $2.44 billion (£1.55 billion) in performing commercial loans, as well as servicing rights on $3.1 billion (£1.9 billion) in loans securitised by GE Capital.
EverBank opened its doors in 1994. The savings and loan company went public on 2 May at $10.00 (£6.37) a share. On Friday 30 June, the company’s shares closed at $10.87 (£6.93). On 2 July 2012, the Bank’s shares rose to $11.35 (£7.23).
The Bank’s goal in acquiring Business Property was to diversify its loan portfolio and earnings mix and with share prices getting a boost, it appears that the company’s move was a savvy one. It gave EverBank’s reputation as an acquirer a boost, as well. The latest acquisition had been the works for about 12 months. Company Chief Executive Robert Clements has not ruled out more deals in the future, stating in a recent interview that EverBank would pursue more acquisitions if the right opportunity presented itself.
The niche market served by GE Capital of owner-occupied commercial properties appears to have weathered the recent economic storm. EverBank predicts Business Property Lending will finance between $500 million (£318 million) and $1 billion (£637 million) in loans a year over what the company describes as the “intermediate term.”
