GMAC Sells Stake
GMAC Reaches Agreement to Sell 60 Percent Stake in Commercial Mortgage
Business to KKR, Five Mile Capital, Goldman Sachs Capital Partners
DETROIT, Aug. 3 -- General Motors Acceptance Corporation (GMAC), the
financial services subsidiary of General Motors Corporation (NYSE: GM),
announced today that it has entered into a definitive agreement to sell a 60
percent equity interest in its commercial mortgage subsidiary, GMAC Commercial
Holding Corp. (GMACCH) to an investor group comprising Kohlberg Kravis Roberts &
Co. (KKR), Five Mile Capital Partners, and Goldman Sachs Capital Partners.
GMAC will continue to hold a 40 percent equity interest in GMACCH, a
leader in commercial real estate loan origination, servicing, asset
management, investment management, and technology services. GMACCH has a loan
servicing portfolio of approximately $250 billion. The Board of Directors of
GMACCH will be composed of individuals from the investor group, GMAC and
GMACCH management. Members of the current GMACCH management team will also
invest in the company shortly after the transaction is completed.
In conjunction with the equity sale, GMACCH will seek to obtain a
standalone credit rating in order to enhance its ability to fund its
operations on an ongoing basis. Under terms of the transaction, the company
will repay all inter-company loans to GMAC upon the closing of the
transaction, thereby providing GMAC significant incremental liquidity.
'GMAC continues to see exciting growth prospects at its commercial
mortgage operations,' said GMAC Chairman Eric Feldstein. 'By partnering with
sophisticated and financially strong investors, we will ensure that adequate
capital is available to GMACCH to sustain its profitable growth. By retaining
a 40 percent equity interest, GMAC will continue to participate in the
company's profitability over the long term.'
GMACCH Chief Executive Officer Robert D. Feller said, 'The acquisition of
a majority interest in GMAC Commercial Holding Corp. by this experienced
investor group represents an extraordinary opportunity for us to enhance the
value of our enterprise.'
KKR, Five Mile Capital Partners, and Goldman Sachs Capital Partners said
in a statement: 'We are very pleased to pursue a transaction with GMAC that
will establish a broad foundation on which GMACCH can realize substantial
future growth. GMACCH is one of the largest providers of commercial mortgage
loans and related products and services in the world, and we look forward to
working with management to expand an already remarkable platform through
enhanced access to the capital markets.'
The agreement is subject to regulatory approvals, consents and other
conditions, and is expected to close in the fourth quarter of this year. The
GM and GMAC boards of directors have approved the transaction.
KKR is one of the world's oldest and most experienced private equity firms
specializing in management buyouts, with offices in New York, Menlo Park,
California and London, England. Over the past twenty nine years, KKR has
invested in more than 130 transactions with a total value of US$146 billion.
For more information, please visit http://www.kkr.com .
Five Mile Capital Partners ('FMCP') is an alternative investment
management firm established in 2003 with equity capital under management of
$800 million. The firm was founded by five professionals, each with over 25
years of experience in all aspects of mortgage, real estate and asset-backed
finance. The partners both collectively and individually have built a number
of leading financial franchises and participated in creating some of the key
innovations in mortgage and real estate capital markets. For more
information, visit http://www.fivemilecapital.com .
Founded in 1869, Goldman Sachs is one of the oldest and largest investment
banking firms. Goldman Sachs is also a global leader in private corporate
equity and mezzanine investing. Established in 1991, the GS Capital Partners
Funds are part of the firm's Principal Investment Area in the Merchant Banking
Division. Goldman Sachs' Principal Investment Area has formed 11 investment
vehicles aggregating $26 billion of capital to date. With $8.5 billion in
committed capital, GS Capital Partners V is the current primary investment
vehicle for Goldman Sachs to make privately negotiated equity investments.
General Motors Acceptance Corporation and its subsidiaries, operating under
the umbrella GMAC Financial Services, provide automotive financing, commercial
finance, insurance and mortgage products, and real estate services, and have a
presence in more than 40 nations. A wholly owned subsidiary of General Motors
since 1919, GMAC has extended more than $1.3 trillion in credit to finance
more than 158 million vehicles.
GMAC Commercial Holding Corp.'s largest operating unit is GMAC Commercial
Mortgage Corporation (GMACCM), a premier financial services firm that serves
the needs of borrowers of commercial real estate debt as well as the providers
of such capital. With a servicing portfolio of approximately $250 billion,
GMACCM is an industry leader in loan origination, servicing, asset management,
investment management and technology services. GMACCM provides a variety of
financing products and services, including permanent, interim, mezzanine and
construction lending, as well as equity capital.
SOURCE General Motors Acceptance Corporation
-0- 08/03/2005 P
/NOTE TO EDITORS: For additional media information, visit
http://media.gm.com ./
/CONTACT: Toni Simonetti of GMAC, +1-212-418-6380, toni.simonetti@gm.com ;
Ruth Pachman, ruth-pachman@kekst.com , or Molly Morse, molly-morse@kekst.com ,
of Kekst and Company, +1-212-521-4800, for KKR; or Andrea Raphael,
+1-212-357-0025, for GS Capital Partners/
/Web site: http://media.gm.com
http://www.gm.com
http://www.kkr.com
http://www.fivemilecapital.com /
(GM)
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