US quoted property broker CB Richard Ellis has agreed to a $750m buyout and privatisation.
The buy-out vehicle, Blum CB Corp, is backed by Blum Capital Partners, Freeman Spogli & Co and CBRE chief executive Ray Wirta. It is offering CBRE shareholders $16 per share in cash, a 50 cent per share improvement on the original offer made in November.
The offer was considered by a special committee, which recommended the offer to the CBRE board at the weekend, which also approved the bid. CBRE is the world’s largest quoted property services company.
Blum CB will raise $400m of senior debt and $75m of mezzanine debt from Credit Suisse First Boston to finance the bid. CSFB will also provide a $100m credit facility. Blum Capital has committed $150m in equity capital for the deal. CBRE employees who own shares will have the opportunity to either sell to the buy-out vehicle or retain their stake in the private company.
Wirta said: “I am very excited about this transaction. The new capital resources, broad employee equity ownership and long-term support of first-class private equity investors position the company well for the future.”
“We appreciate the confidence of the board in accepting our offer as the best alternative for the company, its shareholders, and its employees,” said Richard Blum, chairman of Blum Capital Partners. “CB Richard Ellis has built a pre-eminent global franchise in real estate services. We are pleased to partner with management to guide the company in its next stage of growth.”
