CBRE acquires stake in Turner & Townsend for $ 1.3 billion

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CBRE Group and Turner & Townsend Holdings Limited today announced an agreement under which CBRE will acquire a 60 percent stake and enter into a strategic partnership with Turner & Townsend, a global leader in program, project and cost management from the United Kingdom.

CBRE will pay $ 1.3 billion in cash, of which 55 percent will be paid at close. The deal preserves Turner & Townsend’s existing management team, legacy, operational independence and partnership structure, which will hold the remaining 40% ownership.

The deal is valued by Turner & Townsend at approximately $ 2.2 billion and is expected to immediately boost CBRE’s profits.

Turner & Townsend provides program management, cost consulting, project management and advisory services to clients in 46 countries.

It operates in three business segments: Real Estate (62% of net revenue) – serves investors and tenants in all types of property, including data centers and biological facilities; Infrastructure (31% of net revenue) – in particular, transport, environmental and power generation projects, as well as natural resources (7% of net revenue) – renewable energy sources, alternative fuels, liquefied natural gas and other projects.

For the 12 months ended April 30, 2021, Turner & Townsend had net sales of approximately $ 923 million.

“This is a transformational deal for our project management business in terms of both breadth and scale of opportunity,” said Bob Sulentich, president and CEO of CBRE.

BOB SULENTIC

“We see significant opportunities for long-term growth in project management, driven by increased public and private investment in infrastructure and a move towards a low-carbon global economy. Turner & Townsend is by far the best firm to help us realize our ambitions in this business. It is an exceptionally well-run company with a first-class brand, an enviable customer base and experience to complement our capabilities. ”

One of the key benefits of the strategic partnership for Turner & Townsend is the ability to significantly expand its business in the Americas, where CBRE has strong tenant and investor relationships and is a market leader.

Vincent Clancy, Chairman and CEO of Turner & Townsend, said: “The CBRE and Turner & Townsend joint partnership will create a leading global provider of programs, projects and cost management from day one. Turner & Townsend will continue to offer independent advice, solutions and program-level thinking in the Real Estate, Infrastructure and Natural Resources sectors. Our global network means that it applies everywhere in the world – we work where our customers do. The combination of an unrivaled global presence, industry expertise, commitment to investment and an incredible team of people will make CBRE and Turner & Townsend the leading firms in our industry. ”

Following the close of the deal, Clancy and the existing Turner & Townsend management team will continue to operate the company on a day to day basis and all of its services will continue to be provided under the Turner & Townsend brand. Turner & Townsend’s financial results will be consolidated and presented within the CBRE Global Workplace Solutions (GWS) business segment.

Turner & Townsend will be governed by a new board of directors, which will include three CBRE executives – Sulentik, Jack Derburg, CEO of GWS, and Chandra Dhandapani, Chief Transformation Officer and Chief Operating Officer of GWS, as well as three CEOs of Turner & Townsend – Mr. Clancy, Jeremy Latom-Sharp, Chief Financial Officer, and James Dand, Chief Operating Officer.

The deal is expected to close in the fourth quarter of this year.

Morgan Stanley & Co. LLC acts as financial advisor and Simpson Thacher & Bartlett LLP and Dentons act as legal advisors to CBRE. Rothschild & Co acts as financial advisor and Pinsent Masons LLP as legal advisor to Turner & Townsend.

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