Ares Commercial Real Estate Corp (NYSE:ACRE) closes Alliant Capital LLC acquisition


Dallas, Texas 09/05/2013 (Financialstrend) – Ares Commercial Real Estate Corp (NYSE:ACRE) has announced that it has now closed the acquisition of Alliant Capital LLC. This acquisition has been announced earlier and the deal totaled $61 million. Of this amount $52.9M was in cash. The issuance of 588,235 ACRE shares was valued at $7.4M. This was based on the company’s common stock closing price of $12.65, on 30 August.

Mutual benefit

Alliant Capital LLC is essentially a financial-services company. It focuses on the origination and servicing of multi-family loans for different government sponsored and government entities. It does this mainly via the Fannie Mae- delegated DUS program.

Co-Chief Executive Officer of ACRE, Todd Schuster said that the company expects the closure of this transaction will profit the shareholders as it strengthens the company’s direct-origination platform even as it provides further depth to the company via the addition of Alliant Capital LLC’s significant servicing-operation and experienced management team.

He added this transaction should also add to the company’s book value and provide them with an ideal opportunity to add significant non-interest income. This would help in enhancing dividends and earnings in a very capital-efficient manner.

The name change

Post the closing, Alliant will now change its name and become ACRE Capital LLC. Ed Hurley will continue to head the organization. As a part of this transaction, ACRE Capital LLC has continued holding its 2 warehouse line-facilities with $180M total availability to finance any multi-family loan origination-activity. It will be a direct-subsidiary of ACRE Capital Holdings LLC, the 100% owned newly-formed taxable REIT-subsidiary of Ares Commercial Real Estate Corp (NYSE:ACRE).

Ed Hurley, ACRE Capital LLC’s President said that the entire team looks forward eagerly to taking advantage of any potential revenue and product synergies that this merger brings about. He said that with ACRE’s platform and base they plan on expanding their GSE product-offering and take advantage of the differentiated-value proposition in the market for any long-term and short-term multi-family loans.