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(Reuters) - Private equity-backed EverBank Financial Corp EVER.N said it would buy GE Capital's Business Property Lending Inc division for $2.51 billion to boost its ability to lend to small and mid-sized companies, driving up its shares 6 percent.
EverBank, which went public in May and has a market value of $1.26 billion, has used acquisitions to diversify its operations and increase its assets. The lender bought MetLife Inc's (MET.N) warehouse finance business in February.
The latest deal includes about $2.44 billion of performing commercial loans, origination and servicing platforms, and servicing rights on $3.1 billion of loans securitized by GE Capital.
The deal will add to both earnings per share and return on equity in the "near term," EverBank Chief Executive Robert Clements said in a statement.
Jacksonville, Florida-based EverBank said it expected the deal to boost earnings per share by low double-digits.
EverBank will pay for the deal using existing cash, securities and undrawn funding lines, a company executive said on a conference call to discuss the deal.
The combined company will have pro-forma assets of about $16.2 billion. EverBank had assets of $13.8 billion at March end.
EverBank expects Business Property Lending to originate between $500 million and $1 billion in loans a year in the "intermediate term."
GE Capital curtailed lending by the division, which had once originated more than $4 billion a year in loans, after the financial crisis. The division has originated $317 million in loans so far this year.
EverBank, which counts private equity firms TPG, Sageview Partners and New Mountain Partners as investors, said the deal is expected to close in the fourth quarter.
EverBank's shares were up 6 percent at $11.54 in early trade on the New York Stock Exchange.
Reporting by Jochelle Mendonca in Bangalore; Editing by Viraj Nair, Maju Samuel