After three months of negotiations, the historic £197m deal has closed.
But the chief architects of Jones Lang LaSalle’s takeover of King Sturge – JLL UK chief executive Andrew Gould and his opposite number, Richard Batten – are hardly pausing for breath.
The message to the firms’ combined 2,700 UK staff is “Don’t take your eye off the ball,” says Gould. “Don’t disappear into huddles, strategising. What clients want are new ideas.”
He admits that, in his excitement, he began calling some of those clients as the takeover was signed, late on 26 May. A slightly more cautious Batten waited for the ink to dry on the sale of the 250-year-old business, hitting the phones the next morning.
The reaction, both men say, has been hugely supportive – though tinged with sadness that the King Sturge name is disappearing (see News, p42). But the focus now is on the future, and an ambition to double the value of the business – which has a combined UK turnover in excess of £300m – in the next five years.
That process began as they returned from the Bank Holiday weekend on Tuesday. Among the “massive opportunities” that drove the deal, they stress the importance of combining King Sturge’s strengths in areas such as residential, industrial and the regions with JLL’s global reach, its occupier business and London dominance.
Joint client meetings and pitches are expected to begin almost immediately, and all business carried out after the deal completed at midnight on 31 May become JLL deals.
To lead the integration, an eight-strong UK board has been set up, led by Gould and Batten, to tour the regional offices – King Sturge has 17 outside London, some of which overlap with JLL’s six (see map).
The remaining UK board seats are split equally between JLL and King Sturge and the group will meet on a weekly basis – twice weekly, in the early days – “to make sure integration happens”. An integration planning group will be set up “to make sure we don’t miss a trick”, adds Gould.
Business lines
The firms’ business lines will be led by a new 19-member UK executive, with 12 places taken up by JLL and seven by King Sturge (see panel).
How the two firms’ offices and teams will be merged is yet to be thrashed out. A staff document talks of including “all teams in further development of the structure”.
Employee consultation will begin early this month, followed by initial office moves over the summer. A strategy for further integration will be drawn up by the end of September.
Some redundancies seem to be inevitable. But Batten insists that these will be “isolated cases”, where roles are duplicated.
The two firms share just 16 clients among each firm’s top 50 names, including Lloyds Banking Group, Royal Bank of Scotland, Legal & General, Aviva and USS. “Even when we found client overlap, we were doing different things for that client,” says Gould.
The good news for former King Sturge staff is that they will get some share of the cash windfall going to the firm’s 87 equity partners. Presumably, some of it will be used to sweeten the “marzipan” layer of talent in the King Sturge cake – those on the brink of getting equity when the deal was done.
Meanwhile, equity partners are tied in for five years: only £98m was paid upfront, with the rest to be staged.
Also still to be thrashed out is the integration of the European offices. But both men seem relieved to hand this task over to the European management team, led by EMEA chief executive Christian Ulbrich.
“We’re both concerned with people and clients and making sure things come together seamlessly,” says Gould.
“Over time, Richard is likely to be more people- and client-focused, more externally focused; and I’ll be more focused on making sure we deliver on the numbers.”
