The facilities were purchased from Minneapolis-based office equipment supplier Katun Corp. for roughly $35.6 million. The sale was completed in conjunction with the leveraged buyout of Katun by Banc of America Capital Investors and Chicago-based private equity firm Svoboda, Collins LLC.

Under the terms of the deal, the assets will be leased under two 20-year bond-type net leases. The properties, which total roughly 467,000 sf, include Katun's Bloomington, MN corporate headquarters as well as the company's main distribution facilities located in Davenport, IA and Gorinchem, the Netherlands. W.P. Carey's Corporate Property Associates 14 Inc. made the acquisition.

"This transaction is just another example of the many ways that sale-leaseback financing can be used by companies--in this case to fund the successful LBO of Katun Corporation," says Anne R. Coolidge, executive director at W. P. Carey. "This financing will enable Banc of America Capital Investors and Svoboda, Collins to monetize the real estate assets of Katun Corporation. Even with international properties involved, W. P. Carey is able to customize the transaction to meet the needs of the private equity firms."

In conjunction with BACI's buyout of Katun, BACI and Svoboda will merge Katun Corp. with Madison, WI-based Parts Now! LLC, a portfolio company of the two firms.

"The sale leaseback financing was an important part of our transaction, enabling us to further leverage our equity," says Sheryl E. Bartol, a partner at BACI." W. P. Carey's ability to underwrite the full transaction, including the international facility differentiated them in the market."

Instant Insights /

W.P. Carey Buys US, Dutch Assets Totaling 467,000 SF

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