01—Abstract
Summary
Summary of the 8-K filed February 18, 2011. Cited figures are marked; the original filing is the authoritative source.
CB Richard Ellis Group, Inc. (CBRE) announced on February 15, 2011, significant definitive agreements to acquire substantially all of the European and Asian real estate investment management operations of ING Real Estate Investment Management (ING REIM).
These transactions, divided into the CRES and PERE acquisitions, represent a substantial expansion for CBRE, aiming to bolster its global investment management capabilities and geographic reach. The total purchase price for both transactions is estimated to be approximately $940 milliona (comprising $330 million for CRES and $610 million for PERE, plus estimated market value for co-investment assets).
The agreements are subject to customary closing conditions, including regulatory approvals in various jurisdictions and investor consents. The acquisitions are expected to enhance CBRE's annualized fee revenue, with purchase price adjustments tied to this metric, indicating a strategic focus on recurring revenue streams.
02—Key points
Key Highlights
- CBRE entered into two material definitive agreements on February 15, 2011, to acquire key parts of ING Real Estate Investment Management's business.
- The transactions involve the acquisition of CRES (Clarion Real Estate Securities) for $330 million and PERE (various European and Asian subsidiaries) for $610 million, plus co-investment assets.
- The acquisitions are designed to significantly expand CBRE's global investment management capabilities and presence in Europe and Asia.
- Purchase prices are subject to adjustments based on the annualized fee revenue generated by the acquired businesses at closing.
- Consummation of the transactions is contingent upon several conditions, including regulatory approvals (e.g., HSR Act, Germany, Netherlands, UK, Hong Kong) and receipt of necessary investor consents.
- The agreements have termination clauses, with specific dates for the CRES Transaction (November 15, 2011) and PERE Transaction (December 1, 2011), extendable by mutual agreement.
03—Questions
Frequently Asked Questions
What are the main acquisitions CBRE is undertaking according to this filing?
CBRE is acquiring two main components of ING Real Estate Investment Management: CRES (ING REI Clarion Holding, Inc.) for approximately $330 million, and PERE (certain European and Asian subsidiaries of ING REIM) for approximately $610 million. The deals also include the acquisition of certain co-investment assets within ING REIM managed funds.
What is the total approximate cost of these acquisitions?
The total announced purchase price is $330 million for CRES and $610 million for PERE, plus the market value of co-investment assets which is estimated at $55 million for CRES and to be determined for PERE. Thus, the combined estimated total consideration is roughly $995 million, subject to adjustments.
What are the key conditions required for these acquisitions to close?
Key conditions include the termination or expiration of the waiting period under the Hart-Scott Rodino Antitrust Improvements Act, obtaining approvals from foreign regulators in countries like Germany, the Netherlands, the UK, and Hong Kong, and securing necessary consents from investors to transfer minimum levels of annualized revenue for the accounts managed by the acquired businesses.
How might the final purchase price be adjusted?
The purchase prices for both CRES and PERE are subject to adjustments based on the annualized fee revenue of the acquired businesses at the time of closing. There are provisions for adjustments both at closing and potentially after closing, as detailed in the respective Share Purchase Agreements.
04—Continue