MADRID—Blackstone Group LP has agreed to buyabout 6.4 billion euros ($8.7 billion) of mortgages fromCatalunya Banc SA as it invests in Spain'seconomic recovery, according to report Wednesday from BloombergNews.

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Blackstone was the winner in the process known as“Project Hercules” that began in April, said aBloomberg source, who asked not to be identified becausethe information wasn't public yet. El Confidencial, a newswebsite, reported earlier Wednesday that Blackstone would pay3.5 billion euros for the loans.

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FROB, the fund that controls nationalizedSpanish lenders is seeking a buyer for Catalunya Banc. BancoSantander SA (SAN), according to news reports.

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Bloomberg said Andrew Dowler, aLondon-based spokesman for Blackstone, declined comment, as did aspokeswoman for the FROB.

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The assets sold to Blackstone consist mostly of residentialmortgages concentrated in the region of Catalonia, according to asale document for the portfolio seen by Bloomberg.

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David Phillips

David Phillips is a Chicago-based freelance writer and consultant with more than 20 years experience in business and community news. He also has extensive reporting experience in the food manufacturing industry for national trade publications.