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June 18, 2014

TPG Capital JV Buys DTZ for $1.1B, Taps Brett White as Investor

By Gail Kalinoski, Contributing Editor

Brett White

Brett White

A private equity consortium led by TPG Capital, PAG Asia Capital and the Ontario Teachers’ Pension Plan has agreed to buy global property services firm DTZ from UGL Ltd. of Australia for A$1.22 billion, or $1.14 billion.

The group has also tapped former CBRE CEO Brett White as an investor and expects him to take a future leadership role at DTZ.

The agreement comes about four months after Sydney-based UGL said it was evaluating interest in selling DTZ, which it had owned since 2011. It had also considered a de-merger but officials said in a news release that the Board of Directors concluded it was in the best interests of shareholders to sell the real estate services company so that UGL could focus on its engineering and construction business primarily in Australia, New Zealand and South East Asia.

The cash-only sale, which must be approved by regulators, is expected to close in late September. Goldman Sachs acted as exclusive financial advisor and Herbert Smith was legal advisor to UGL.

The Sydney Morning Herald reported that TPG Capital had UBS as its lead advisor and also received advice from JPMorgan and Credit Suisse. The newspaper also reported that Warburg Pincus, Ares Management and Bain Capital were among the bidders for DTZ.

“The sale price reflects the significant value we have created in building a unique platform over this time delivering a highly positive result for UGL and its shareholders,” Richard Leupen, UGL managing director & CEO, said in the release. “The sale of DTZ to the TPG and PAG Consortium will provide the business with the flexibility to undertake its next stage of growth.”

Tod Lickerman

Tod Lickerman

In its own release, the consortium said it was keeping Tod Lickerman on as CEO. Lickerman, JLL’s former CEO of Corporate Solutions Americas, was appointed DTZ CEO in September. The group also said Brett White, the former CEO of CBRE Group, was an investor in the consortium and would be joining the Board of Directors once the transaction was completed. White, who stepped down from CBRE in late 2012, will become executive chairman of DTZ in March 2015, reportedly when his CBRE non-compete agreement expires.

“We have all been impressed with the quality and depth of industry knowledge residing in DTZ’s existing senior management team and are pleased Tod Lickerman has agreed to stay on and will continue in his current role as Global Chief Executive Officer of DTZ,” Ben Gray, TPG Capital’s managing partner of Asia, said in the consortium’s release.

Gray added that they were “delighted” that White was investing in the acquisition and would be a board member and eventually executive chairman.

DTZ is a leading global integrated property services company with operations in 208 cities in 52 countries. The firm’s roots date back to 1784 in the United Kingdom where it was founded as Chesshire Gibson. It is still the market leader in the U.K. with about 6,000 commercial properties under management.

Weijian Shan, PAG’s group chairman & CEO, cited DTZ’s strength in China as well as other key markets around the world.

“DTZ has impressive resources and capabilities in Greater China, Western Europe, Australia, Singapore and North America,” he said in the consortium’s release. “In particular, we believe that DTZ holds the market leading position in Greater China, the world’s fastest growing services marketplace.”

Gray said the company’s experience combined with the investors will accelerate DTZ’s growth.

“We see a great opportunity in commercial real estate services to create a best-in-class firm servicing clients on a global basis,” he said.

DTZ earlier this month opened its Latin American regional headquarters in Mexico City headed by CRE veterans Guillermo Sepulveda as president of DTZ in Latin America and Mexico and Emile Sarraf as COO.

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