Mergers & Acquisitions

Last updated on May 13th, 2019 at 02:40 pm

CB Richard Ellis to acquire Trammell Crow

CB Richard Ellis Group, the Los Angeles-based company that acquired The Polacheck Co. Inc. of Milwaukee earlier this year, announced it has agreed to buy Trammell Crow Co. for $2.2 billion.

The merger will create a commercial real estate behemoth with combined revenue of $4.4 billion and 21,000 employees. The merged corporation will be the first commercial real estate services company to qualify for the Fortune 500 list of the largest U.S. corporations.

CB Richard Ellis plans to issue $2.2 billion in term loans to finance the transaction and also will amend or refinance its existing $600 million revolving credit facility.

The acquisition is expected to close either in late 2006 or early 2007, subject to approval by Dallas-based Trammell Crow Company’s shareholders and federal regulatory agencies.

“Our strategic objective has long been to create the market-leading commercial real estate services firm delivering comprehensive solutions to our clients. Well targeted acquisitions have played a pivotal role in our strategy,” said Brett White, president and chief executive officer of CB Richard Ellis. “With the acquisition of Insignia in 2003, we achieved preeminence in our transaction business. Now the acquisition of Trammell Crow Co. creates the best-in-class corporate outsourcing and institutional property management business, and further augments our transaction business. Trammell Crow Co. is one of the premier service companies in our industry, with a rich history, dedicated employees and strong management, a stellar client base and core competencies that are highly complementary to our own.”

Upon completion of the transaction, Trammell Crow’s Development and Investment business will be run as a wholly owned but independently operated subsidiary. It will retain the Trammell Crow Co. brand name.

Robert Sulentic, chairman and CEO of Trammell Crow Company, will join CB Richard Ellis as group president with responsibility for the Development and Investment business, as well as the company’s EMEA and Asia-Pacific operations.

Cal Frese, CB Richard Ellis’ president of the Americas region, said “We are excited about having the Trammell Crow Company team join with ours and its service offerings becoming a valuable part of our platform. Importantly, both companies have very similar and proud heritages that are embedded in their corporate cultures, and which highly value integrity, work ethic and customer service excellence. We’ve had terrific success with integrating large service companies in the past, based on the idea of adopting the best people, processes and ideas of both companies, and we believe this integration will also succeed because of the similar cultures and business fit.”

CB Richard Ellis plans to sell Trammell Crow’s 20 percent ownership interest in Savills, plc, a real estate services provider in the United Kingdom.

Kentucky company to acquire Oak Creek plant

Covington, Ky.-based Ashland Inc. announced it has signed a definitive agreement to purchase the assets of Northwest Coatings, which operates a plant in Oak Creek.

Northwest Coatings is a formulator and manufacturer of adhesives and coatings employing ultraviolet and electron beam polymerization technologies. The company, which also has a plant in Greensboro, N.C., is a holding of Caltius Equity Partners.

The transaction is valued at approximately $72 million. Trailing 12-month sales of Northwest Coatings are nearly $40 million.

“This is an important acquisition for us in a high-growth, attractive market segment,” said James O’Brien, chairman and chief executive officer of Ashland Inc. “It demonstrates our strategy to pursue acquisition opportunities in markets and technologies that are experiencing rapid change.”

All of the employees in Oak Creek will be retained when the transaction is closed, presumably by the end of the year, according to Craig Heim, vice president of Grace Matthews Inc., a Milwaukee mergers and acquisitions consultant company that represented Northwest Coatings in the negotiations.

Marcello Boldrini, vice president of Ashland Performance Materials and general manager of specialty polymers and adhesives, said, “With this transaction, we strengthen our adhesive and coatings offerings to the packaging, converting and labeling markets. Northwest is a leader in ultraviolet and electron beam chemistries, and we expect to leverage these technologies throughout our business on a worldwide basis.”

Snap-on to acquire Michigan automotive supplier

Snap-on Inc. announced it has entered into a definitive agreement to acquire ProQuest Business Solutions from Ann Arbor, Mich.-based ProQuest Co. for approximately $480 million in cash, plus the assumption of $19 million of debt.

ProQuest Business Solutions is a provider of automotive parts and service information. Its products are aimed at helping original equipment manufacturers (OEMs) and their dealers enhance their service operations. ProQuest reported annual revenue of $185 million in the past year.

“This is a compelling strategic transaction that affords exciting growth opportunities for our customers, associates and shareholders,” said Jack Michaels, chairman, president and chief executive officer of Kenosha-based Snap-On.

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