Erste Group pulls €2.7bn Project Neptune sale

The loan book and servicing platform called Project Neptune and belonging to Romanian bank BCR failed to reach a satisfactory price for its Austrian-bank owner.

Austria-headquartered bank, Erste Group, has pulled the sale of a €2.7 billion loan book and servicing platform linked to its Romanian subsidiary, Banca Comerciala Romana, dubbed Project Neptune.

The bank turned down a bid from a consortium of Blackstone, HIG Bayside Capital and AnaCap Financial Partners and another separate offer from Lone Star, Bloomberg reported. 

Erste refused both bids over pricing, PDI understands. 

The Project Neptune sale was a benchmark transaction for Central and Eastern Europe, given it is the largest portfolio to come to market from the region since the financial crisis. However, it’s likely the portfolio will need to be broken into smaller portfolios in order to appeal to investors and narrow the gap between the bid and ask price, a source close to the situation said. PwC is advising the Erste Group on the sale.

The Erste Group, AnaCap and PwC did not respond to a request seeking comment. Blackstone, HIG and Lone Star declined to comment.

The private investment firms alongside another consortium of Deutsche Bank, the Baupost Group and Sankaty and separate bidder Apollo Global Management, all made offers for the portfolio in June, as first reported by PDI.

Project Neptune comprised of unsecured corporate debt, residential and commercial real estate debt. It also included a servicing platform of around 350 people, Co-Star reported.

The majority of portfolios which have come to market from Romania have priced below 20 cent. However, the Erste Group has an average coverage ratio of above 82 percent for its Romanian assets, a spokeswoman for the bank previously told PDI.