Japan’s Bank of Tokyo-Mitsubishi (BTMU) continues its acquisition of Royal Bank of Scotland’s (RBS) project finance activities, this time taking over RBS Australia’s project finance advisory team in a deal set to close early next year, sources close to the transaction told Infrastructure Investor.
RBS’ project finance advisory team Down Under counts 18 members and is led by Geoff Daley. A source close to the deal described it as a “typical corporate sale” of a team focusing on an area – project finance – that is non-core to RBS. Existing advisory mandates are also part of BMTU’s acquisition.
“This is a good deal for RBS and it’s also a good deal for the team, which will now have a broader remit,” an inside source commented. The source explained that RBS Australia, whilst exiting project finance advisory, will still retain its infrastructure M&A advisory team.
The acquisition of the bank’s Australian project finance advisory unit is the latest in a fruitful relationship between RBS and the Japanese bank. Late last year, BTMU bought RBS’ project finance portfolio – consisting mostly of loans to infrastructure and power assets in Europe, the Middle East and Africa (EMEA). While the sale price was not disclosed, the project finance book acquired from RBS was valued at about £3.8 billion (€4.4 billion; $6.1 billion).
At the time, the Japanese bank said the acquisition, including the transfer of certain employees, “will significantly strengthen BTMU’s project finance business in EMEA and will assist it in achieving its aim of becoming one of the leading project finance banks globally”.
Project finance lending became a non-core activity for RBS after the UK government was forced to inject over £45 billion into the bank as a result of the financial crisis, forcing RBS to deleverage. Prior to the 2008 crisis, RBS was one of the leading global project finance lenders. Post-crisis, the bank has mostly limited its project finance activities to the advisory sector.