Lloyds Banking Group has sold a €140m senior loan reflecting around 20% of the total debt secured by Moran Hotel Group to Canyon Capital Advisors, a US hedge fund, at a 70% discount.
The nominal €140m loan is a portion of Moran Hotel Group’s €693m of debt, much of it linked to the €570m takeover of the Bewley’s hotel chain in 2008, according to the Irish Independent.
The share of the debt held by Lloyds was originally advanced by its Bank of Scotland (Ireland) unit. The remaining €553m of debt is held by a syndicate of Irish banks which also includes Bank of Ireland, Allied Irish Bank and Ulster Bank, a subsidiary of Royal Bank of Scotland.
A spokesperson for Canyon Capital Advisors told CoStar News: “We can confirm that Lloyds have sold their debt onto Canyon Capital. We have the full support of the syndicate of banks and are presently at an advanced stage of a restructuring plan.”
Given that Canyon only paid €42m for the €140m loan, Moran is likely to be able to negotiate an easier restructuring with the US hedge fund as Lloyds has written off a significant part of the bad debt.
This is the second individual loan sale by Lloyds in the last month, following Cerberus’ acquisition of the £150m Tritax loan, secured by 11-strong portfolio throughout the UK, for £85m which closed both deals just days before Christmas.
Lloyds Banking Group declined to comment.