(GP Investments) April 19, 2012 – GP Investments, Ltd. (“GP Investments”), a leading alternative asset investment firm in Latin America, hereby announces the conclusion of the sale of its remaining stake in BR Properties, the largest publicly traded commercial property company in Brazil with over R$10 billion in assets.
GP Investments founded BR Properties in December 2006 with an initial investment of US$25 million from its private equity fund GP Capital Partners III, L.P. (“GPCPIII”), co-investors and others. In April 2007, BR Properties made its first acquisition, a 16-story building in Sao Paulo, for approximately US$7 million. Five years later, BR Properties announced the largest acquisition in its history; the purchase of Ventura Brasil Empreendimentos Imobiliários Ltda in Rio de Janeiro for US$407 million.
In the three years that followed its incubation at GP Investments, BR Properties executed an aggressive acquisition strategy, partially fueled by two private placements. In 2010, BR Properties completed a very successful IPO and has seen its share price appreciate 75% since then.
BR Properties has cemented itself as the largest publicly traded commercial property company in Brazil, four times larger than its closest competitor, with 124 properties across 14 states and 2 million square meters of gross leasable area worth more than R$10 billion. This investment clearly demonstrates the consolidation opportunities available in Brazil, and more importantly, showcases GP Investments’ ability to identify unique investment opportunities, build seasoned teams, access the capital markets and coordinate the implementation of a business plan.
GPCPIII invested a total of US$49.2 million into BR Properties. In addition, GP Investments raised US$50.8 million through co-investment vehicles managed by GP Investments and US$341.9 million from third parties which invested directly into BR Properties.
GP Investments, via its investment vehicles, sold 26% of its original stake in December 2010 and an additional 24% in April 2011, via multiple block trades. In the final transactions, GP Investments, through its vehicles, exited its remaining 50% stake in BR Properties, receiving proceeds of US$121 million.
GPCPIII’s total investment of US$49.2 million in BR Properties generated returns of US$127 million, resulting in a cash-on-cash multiple of 2.6x and an IRR of 26.3% in US Dollars.
GP Investments, as an investor in two co-investment funds and as a direct investor in BR Properties, invested US$37.1 million and received US$78.5 million, generating a cash-on-cash multiple of 2.1x and an IRR of 22.3% in US Dollars.
Overall, taking into account the combined investments made by GP Investments through GPCPIII, the co-investment vehicles and directly into BR Properties, GP Investments received proceeds amounting to US$134.8 million based on an investment of US$58.9 million, ensuring a cash-on-cash multiple of 2.3x and an IRR of 24.1% in US Dollars.
GP Investments firmly believes that BR Properties remains uniquely positioned to continue executing its consolidation strategy in the Brazilian commercial property segment.
About GP Investments
GP Investments, a leading alternative asset investment firm in Latin America, has been actively investing in the region since 1993. GP Investments has raised over US$5 billion with a track record of 49 completed deals across 15 different sectors. In May 2006, GP Investments concluded its IPO, becoming the first listed alternative asset investment firm in Latin America. For more information see GP Investments’ web-site (www.gp-investments.com) or contact the company’s media contacts.