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Ostermann & Partners Advises APS Holding on NPL Portfolio Acquisition in Croatia

Ostermann & Partners Advises APS Holding on NPL Portfolio Acquisition in Croatia

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Ostermann & Partners has assisted APS Holding with its acquisition of a Croatian portfolio of non-performing loans with a nominal value significantly exceeding EUR 100 million from Hrvatska Postanska Banka with the approval of the Croatian National Bank. The Hrvatska Postanska Bank was reportedly advised by Schoenherr.

According to an APS press release, the acquisition includes secured and unsecured non-performing corporate loans, with the secured positions held against mostly residential, commercial, and industrial property. Following the transaction, APS has established a permanent office in Zagreb to service the NPL portfolio, which should be populated by over 40 debt collection professionals, analysts, and other personnel by the end of Q2 2017.

Founded in 2004 and headquartered in Prague, APS specializes in investment, management, and recovery of loan portfolios and real estate within Central and South-Eastern Europe. According to that same APS press release, the company, which claims "more than 600 experts ... provides services in 11 European countries: Bulgaria, Croatia, Cyprus, the Czech Republic, Hungary, Montenegro, Poland, Romania, Greece, Serbia and Slovakia." It manages 75 NPL portfolios with a total nominal value above EUR 4.7 billion "and provides exclusive investment advisory to four investments vehicles and recognized institutional investors."

Since the beginning of 2016, APS has expanded its operations into Cyprus, Hungary, and now Croatia. The Cypriot expansion is based on a joint venture with Hellenic bank (APS 51%, Hellenic Bank 49%) and involves a distressed debt portfolio of EUR 2.4 billion (as reported by CEE Legal Matters on January 19, 2017). The Hungarian office was established in January 2017 (as reported by CEE Legal Matters on March 23, 2017)

APS has a single shareholder, co-founder and CEO Martin Machon, who commented, following the Croatian acquisition, that: “Our target is to assist banks with distressed debts and help debtors to be debt free under fair and mutually advantageous conditions. We are going to bring our best professional practice based on more than 500,000 debt recovery cases and 13 years of history on the EU market. We are as well looking for other investment opportunities on the dynamic Croatian market.”

Victor Angelescu, CEE Regional Director of APS commented that: "The portfolio from Hrvatska Postanska Banka is just a start for us and we expect to be successful in other tenders in Q1 2017. Although the first employees are already on board, we are still searching on the market for ambitious and talented people with skills not only in the NPL field."

And Viktor Levkanic, Investment Director of APS, commented that: “We have been actively participating in the NPL transactions in Croatia since the beginning of 2015, when the very first sizable transaction came to the market. During this time, we have built up our local market knowledge, understanding and relationships. We believe in the market, see a strong potential for further investment opportunities and also trust the long-term performance of the real estate market and the economy overall.”

The Ostermann & Partners team was led by Managing Partner Mojmir Ostermann, supported by Partners Mila Selak and Vjekoslav Ivancic.

The Schoenherr team was led by Bucharest-based Partner Matei Florea. The firm did not reply to our inquiry on the matter.