GE Capital close to Australian exit

The final bidding round for GE Capital’s Australian mid-market lending units reportedly includes three prospective buyers.

Sankaty Advisors, Lone Star and China’s HNA Group are the final bidders in GE Capital’s sale of its Australian commercial lending and leasing businesses, The New York Times reported

The Australian businesses for sale include private aircraft and equipment rental financing, as well as supply chain and corporate finance units. The corporate finance business includes the firm’s mid-market leveraged lending franchise. GE Capital has already sold its Australian fleet financing unit. 

Morgan Stanley is running the Australian sale process.

The report, which cited a source with direct knowledge of the sale process, said Macquarie Group, Bank of Queensland and three private equity firms — Blackstone, KKR and TPG Capital — had been turned down or dropped out of the race.

A spokesperson for GE could not be reached for comment.

The sale is part of the US industrial group’s plan to dispose of most of its financial service business lines, housed under the GE Capital brand, in an attempt to shed a new regulatory label: systemically important financial institution. GE announced that it would reduce GE Capital’s proportion of the overall business from 42 percent in 2014 to less than 10 percent. 

On Monday, GE announced that it had completed the sale of its US fleet services business to Canada’s Element Financial Corporation. The same buyer has agreed to purchase GE’s Mexican, Australian and New Zealand fleet businesses and those deals are expected to close by the end of this month. 

Boston-based Sankaty Advisors is the credit arm of Bain Capital and has around $26.8 billion in assets under management.

Texas-headquartered distressed debt specialist Lone Star is one of the biggest purchasers of non-performing loan portfolios in Europe. It has raised almost $60 billion for closed-ended private funds since it was established in 1995. 

HNA Group includes a large leasing and insurance business alongside other financial services products. The diversified conglomerate also has interests in real estate, airports retail and logistics.