Real estate service provider DTZ this week confirmed the close of its sale to a private investment consortium composed of TPG Capital (TPG), PAG Asia Capital (PAG) and Ontario Teachers’ Pension Plan (the TPG & PAG Consortium), by Australian engineering firm UGL.
In an announcement, DTZ confirmed the close of the $1.1 billion transaction that was first revealed in June of this year, and has since played out across the global media after questions arose about the role of current Hong Kong chief executive CY Leung in negotiating the sale of DTZ to UGL in 2011.
Former CBRE Chief Brett White to Head Newly Privatized Company
In its newly privatised form, DTZ will operate under the leadership of former CBRE CEO Brett White, starting in March 2015. White’s hire was announced in June at the same time that the sale to the TPG-led group was made known.
Current DTZ Global CEO Tod Lickerman will continue in his current role and report to White.
“DTZ now has the independent governance, strong capital base and speed-to-market of a private company, which will allow us to grow and serve our clients’ ever-changing needs,” Lickerman.commented in a company statement.
Growing Through Acquisition of Cassidy Turley
In September, an affiliate of DTZ Investment Holdings (backed by the TPG &PAG Consortium) announced it had entered into an agreement to acquire US-based real estate consultancy Cassidy Turley, with plans to combine it with the DTZ business during 2015. The acquisition of Cassidy Turley is expected to be completed by December 31, 2014.
Following the Cassidy Turley acquisition the newly-combined company is estimated to represent $2.9 billion of annual revenue and to employ more than 28,200 people. Under the new arrangement, Joseph Stettinius Jr., Cassidy Turley CEO, will become Chief Executive of the Americas, reporting to Tod Lickerman, and the US operation will rebrand as DTZ in 2015.
Speaking on behalf of the TPG & PAG Consortium, TPG’s Ben Gray said, “The combination of DTZ’s strong businesses in Asia and Europe, its existing businesses in the United States and Cassidy Turley’s market-leading business in the United States, will create a global, full service property services company that will be top 3 in the sector.”
UGL Closes the Book on CY Leung Controversy
The finalisation of the sale of DTZ also closes the book on a messy chapter for UGL, which saw its original purchase of the real estate agency become a regional controversy over whether CY Leung concealed payments made to him as part of the transaction.
According to an investigation unveiled last month, while DTZ’s other shareholders were wiped out when the 200-year-old property advisory was put into administration and immediately sold to UGL in December 2011, Leung secretly collected GBP 4 million ($6.5 million) in payments.
Leung failed to reveal these payments to Hong Kong’s authorities, despite receiving them while in office as the territory’s chief executive.