ASSET SALES:AIB IS set to sell four businesses that allow people to invest in corporate loans to a division of private equity giant Blackstone.
The Irish bank said yesterday that AIB Capital Markets had agreed to sell a series of collateral management businesses to GSO Capital Partners LP, Blackstone’s $31 billion credit investment arm.
Under the terms of the deal, GSO will replace AIB as manager on about €928.9 million of collateralised loan obligations, according to a number of notices issued yesterday to the Irish Stock Exchange.
The four vehicles, Boyne Valley, Clare Island, Skellig Rock and Tara Hill, were used to securitise corporate loans. Known as collateralised loan obligations, they pool high-yield, high-risk debt into securities that carry various risks and give various returns.
This allows third parties to invest in them in the hope of getting a return from the loans, assuming the debtors repay them. The borrowers use the money to pay for buyouts and acquisitions that require high levels of debt.
Blackstone, the world’s biggest private-equity firm, bought GSO in March 2008 to expand investments in credit, including leveraged loans. Chairman and chief executive Stephen Schwarzman said on an earnings call last month that New York-based GSO “is one of our fastest-growing businesses”.
AIB, which is almost wholly State-owned, did not reveal the price at which it had agreed to sell the four businesses.
