ING will sell most of its real estate management operations for about $1 billion to U.S.-based property broker CB Richard Ellis Group, helping the Dutch bancassurer to pay down state aid.
ING said in a statement on Tuesday that the deal would give it an after-tax gain of about 500 million euros, including two smaller deals.
The bank still needs to pay back 5 billion euros in state aid plus costs, following a 2008 government bailout during the credit crisis.
The Dutch firm, which was forced to split its insurance and bank operations to obtain European Commission approval for the state aid, had writedowns of several billion euros during the crisis, partly because of its property investments.
The price is more or less in line with expectations and what I had heard. This is a nice capital gain, obtaining about $1 billion to pay back state aid, KBC Securities analyst Dirk Peeters said.
ING, which plans two initial public offerings for its insurance activities, received 10 billion euros in government aid in 2008 at the height of the crisis.
It has already sold several assets to raise funds to repay the state. One of the biggest so far was the sale in January 2010 of its Asian private banking operations for $1.5 billion to Singapore's Oversea-Chinese Banking Corp.
ING shares were down 0.7 percent at 8.94 euros at 1527 GMT, compared with a 0.1 percent decline in the STOXX Europe 600 Insurance index.
CB Richard Ellis Group (CBRE) is one of the world's largest real estate services companies, whose brokers link buyers and sellers of commercial real estate as well as landlords and tenants.
In a separate statement, it said the deal would add $60 billion to its portfolio, up from $37.6 billion at year-end.
The combined enterprise will further diversify our revenue sources, said Brett White, CB Richard Ellis's chief executive officer, in a statement.
CBRE said that the deal would primarily add European investors to its client base, which is mostly in the United States.
It is buying most of ING's Real Estate Investment Management operations in Europe and Asia, as well as ING's U.S.-based global real estate listed securities.
The U.S. company will pay cash from its existing funds and from a credit facility. It expects about $150 million in transaction and integration costs.
ING said it had also agreed to sell the private market real estate investment manager of its U.S. operations, Clarion Partners, to Clarion Partners' management in partnership with U.S. private equity firm Lightyear Capital LLC for $100 million.
Clarion Partners managed 16.5 billion euros at end-2010.
ING is also continuing to wind down its Australian property management operations. A consortium led by Australia's top listed property firm, Goodman Group made a bid for its Australian listed ING Industrial Fund.
(Editing by Sara Webb and Jane Merriman)