CHICAGO—Ares Commercial Real Estate Corporation has just closed its acquisition of EF&A Funding, L.L.C, d/b/a Alliant Capital LLC, for about $61 million through a combination of $52.9 million in cash and the issuance of 588,235 shares of ACRE stock worth $7.4 million. The Chicago-based ACRE first announced the deal last spring. Alliant is a financial services company focused on originating and servicing multi-family loans for various GSEs, primarily through the Fannie Mae Delegated Underwriting and Servicing program.

“We expect that the closing of this transaction will benefit our shareholders as it greatly strengthens our direct origination platform while providing further depth to our company through the addition of Alliant's experienced management team and significant servicing operation,” says Todd Schuster, co-chief executive officer of Ares. “Additionally, this accretive transaction should increase book value and provide an opportunity to add meaningful non-interest income which should enhance earnings and dividends in a capital efficient manner.”

Alliant will now change its name to ACRE Capital LLC and Ed Hurley will continue to lead it as president. ACRE Capital LLC has retained its two warehouse line facilities with $180 million of total availability to finance multi-family loan originations. ACRE Capital will also be a direct subsidiary of ACRE Capital Holdings LLC, a wholly owned, newly formed taxable REIT subsidiary of ACRE.

“Our entire team looks forward to taking advantage of the potential product and revenue synergies in the combination,” says Hurley. “With ACRE's capital base and platform, we plan to expand our GSE product offering and take advantage of our differentiated value proposition in the market for short- and long-term multi-family loans.”

Instant Insights /

Ares Closes $61 Million Purchase of Alliant

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