Navitas Business Sold
United Community Banks Sells Navitas Equipment Finance Unit to Wafra for $1.9 Billion
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Key Points
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The $1.9 billion cash purchase price is based on a valuation that “represents a 7% premium to the par value of Navitas’ loan portfolio,” according to the company’s deal announcement.
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Reuters reported market and advisory details: United’s shares rose about 4% in premarket trading, and “BofA Securities advised United on the transaction.”
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In its SEC filing, United described the transaction structure: on June 11, 2026 the Bank entered a Stock Purchase Agreement under which the buyer (Navitas TopCo LLC) will acquire all issued and outstanding equity of Navitas Credit Corp. and NLFC Reinsurance Corp., and “United will guarantee the Bank’s payment and performance obligations” under the agreement.
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United said the deal is also expected to involve people and operations transfer: “Navitas' existing executive leadership team and employee base are slated to transition with the operating business to Wafra-managed TopCo modules.”
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The company indicated post-closing capital redeployment flexibility beyond securities reinvestment, saying it “intends to evaluate a range of capital deployment alternatives after closing,” potentially including organic growth, balance sheet optimization, share repurchases, and opportunistic M&A consistent with its strategy.
United Community Banks agreed to sell its equipment finance business — including Navitas Credit Corp. and NLFC Reinsurance Corp. — to funds managed by Wafra in an all-cash deal worth about $1.9 billion, the company announced June 12. Shares of United (UCBI) jumped roughly 4% in premarket trading after the news broke, according to Reuters.
The sale removes a unit that punched well above its weight in losses. Navitas made up only about 10% of United's total loan book but accounted for nearly half of the bank's net charge-offs over the prior year, according to United Community Banks.
A Lopsided Loss Ratio Drove the Decision
United CEO Lynn Harton said the deal lets the bank "sharpen our focus on our core Southeastern relationship banking strategy." He added that "the current credit environment necessitates a more streamlined, lower-risk profile" for the loan portfolio. In short, Navitas was too volatile to keep.
United originally bought Navitas in February 2018 for roughly $130 million to diversify beyond mortgages and commercial real estate. Eight years later, persistent high rates and a slowdown in logistics and construction made the equipment finance unit a drag on credit quality, according to GuruFocus.
$1.9 Billion Deal Comes With a 7% Premium and a Big Capital Boost
The $1.9 billion price tag represents a 7% premium over the par value of Navitas' loan portfolio, according to Nasdaq. The deal is structured as a Stock Purchase Agreement, signed June 11, under which buyer Navitas TopCo LLC — a Wafra vehicle — will acquire all issued and outstanding equity of both Navitas Credit Corp. and NLFC Reinsurance Corp. United will guarantee the Bank's payment and performance obligations under the agreement.
The financial benefits are immediate on paper. United expects a one-time pre-tax gain of about $109 million and roughly 3% accretion to tangible book value per share. Its Common Equity Tier 1 (CET1) capital ratio — a key measure of a bank's financial cushion — is set to rise by 145 basis points. Analysts at Raymond James and KBW called that boost "extraordinarily rare" for a single transaction, according to Reuters.
United Plans to Park Cash in Safe Assets While Eyeing M&A
Selling Navitas also frees up a lot of cash. The bank's pro forma loan-to-deposit ratio will drop to around 74%, according to TipRanks. United plans to reinvest the excess funds into short-duration securities with yields in the mid-4% range — a conservative, defensive move for the rest of 2026.
United also left the door open for bigger moves. The company said it "intends to evaluate a range of capital deployment alternatives after closing," which could include share repurchases or opportunistic acquisitions of smaller community banks. BofA Securities advised United on the transaction, according to Reuters.
Wafra Sees a Growth Platform Where United Saw Risk
Wafra — an alternative investment firm backed by Kuwait's public pension fund — is not buying a problem. It is buying a platform. Industry observers say Wafra paid the 7% premium because it believes it can manage equipment finance credit risk more efficiently than a regulated commercial bank, according to MarketScreener.
Navitas CEO Gary Shivers and the company's full employee base are slated to move to Wafra's TopCo structure. Shivers said the new setup provides "a dedicated capital base tailored to the specific needs of the equipment finance sector." The deal is expected to close in the third quarter of 2026, pending regulatory approval.
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