Fund BEST I NSFIZ, a unit of this listed company, will purchase a consumer debt portfolio from Eurobank with a nominal value of nearly PLN 323 million. The purchase will be financed partly with funds raised during the public issue of BEST bonds in April of this year.
The portfolio purchased by BEST I NSFIZ comprises consumer debt and its total nominal value stands at PLN 322.7 million. The fund will pay PLN 27.9 million for this portfolio.
Thus, the contract executed with Eurobank is the biggest transaction of this type carried out by the BEST Group this year. "During the first six months of the year we were less active on the debt market although we participated practically in all significant tender procedures organised by the banks. This is an effect of a highly selective approach to investments, particularly given the noticeable increase in average prices of debt sold observed over the past few months," said Krzysztof Borusowski, CEO of BEST.
"The supply of irregular debt remains at a high level. We expect that in 2014 the total value of debt sold by banks may exceed the record-high value of 2013, i.e. approx. PLN 9.5 billion. We are prepared both in organisational and financial terms to participate in transactions exceeding the value of investments made in previous years," the CEO of BEST pointed out. "We have a strong cash position and one of the lowest debt ratios in the sector, and thanks to the public bond issue program underway we are able to respond flexibly to investment opportunities that come up by issuing more bond series," Krzysztof Borusowski added.
Within the program adopted in February this year, with a total value of PLN 300 million, so far BEST has carried out a public issue of K1 series retail bonds worth PLN 45 million. Some of these funds will now be transferred to BEST I NSFIZ (BEST will acquire bonds from the fund with a nominal value of PLN 10 million) in order for the fund to finance the purchase of the debt portfolio from Eurobank.
BEST: Company Overview
BEST S.A. is a company that has been listed on the Stock Exchange in Warsaw since 1997, specialising in trading in and managing of non-performing debt. The BEST Group actively invests in debt portfolios (especially banking ones) with the use of securitisation funds, and also provides debt collection services for third parties: banks, telecommunication operators and power companies, and other mass service providers.
BEST is also the sole shareholder of BEST TFI, which obtained a licence to operate from the Polish Financial Supervision Authority (KNF) in 2008. The combination of expertise in the field of debt collection with that in the establishment and management of investment funds helped the entity to concentrate all elements of its business model within one capital group.
BEST TFI currently manages three securitisation funds: BEST I NSFIZ, BEST II NSFIZ and BEST III NSFIZ, the assets of which include debt portfolios with a total par value of 8.2 billion PLN (as at the end of June 2014).