Aareal Bank shortlists private equity firms in sale of tech unit: sources

FRANKFURT (Reuters) - German real estate lender Aareal Bank ARLG.DE has shortlisted several private equity groups interested in a stake in its software business Aareon, people close to the matter said.

EQT, Blackstone and Bain are among those to have advanced to the final round of bidding for a minority stake in Aareon, which is expected to be valued at 500-600 million euros ($560-$672 million) as a whole, including debt, in a sale, they added.

Aareal Bank, EQT and Blackstone declined to comment, while Bain was not immediately available for comment.

In May, Aareal Bank said it was working with consultancy firm Arma Partners and inviting bids for a minority stake in Aareon to help finance the software business’s future growth.

Activist hedge fund investor Teleios Capital had previously urged Aareal Bank to consider a sale of Aareon and not to disregard expressions of interest in a majority or outright purchase of Aareon.

According to people close to the matter, several private equity groups have proposed buying a majority of Aareon or even some additional Aareal assets with a view of combining them with their own assets.

Aareal has so far said it is only looking for a minority investor.

Reporting by Arno Schuetze; editing by Thomas Seythal and Mark Potter