UniCredit Signs Agreement With Dorotheum to Dispose of Italian Pawncredit Business

UniCredit SpA (UCG.MI) said Thursday that it has signed a binding agreement with Dorotheum GmbH & Co KG for the disposal of its Italian pawncredit business.

The transaction envisages a consideration of 141 million euros ($167.1 million) at closing and a potential earn-out in favor of UniCredit of up to EUR10 million after three years, the bank said.

The operation is subject to regulatory approvals.

Completion of the deal is expected in the first half of 2018 through the contribution of the pawncredit business to a newly set up financial company that will be wholly owned by Dorotheum, UniCredit said.

A close to EUR100 million positive impact will be generated for UniCredit next year, as well as almost 4 basis points on its consolidated common equity tier 1 ratio, which is a key measure of capital strength for banks, it said.

Dorotheum, which intends to expand its business throughout Italy, has been an Austrian pawncredit service provider and auction house for more than 310 years. With this agreement, it will become the largest operator in Europe, UniCredit said.

Write to Marc Bisbal Arias at marc.bisbalarias@dowjones.com

(END) Dow Jones Newswires

November 30, 2017 02:27 ET (07:27 GMT)