TPG-backed DTZ to buy Cassidy Turley

DTZ, the London-based property services firm acquired in June by a private equity consortium led by TPG Capital, is set to complete its global offering by acquiring its US complement, Cassidy Turley, it was announced today. 

The Washington, DC-based firm entered into an agreement with an affiliate of DTZ Investment Holdings, an entity backed by TPG alongside Asian private equity firm PAG Asia Capital and the Ontario Teachers’ Pension Plan, for its sale in a deal expected to close at the end of the year.

“Following a period of intensive mutual due diligence, we are confident that this combination is an excellent cultural fit as well as an opportunity to partner with a global brand,” said Joseph Stettinius Jr, Cassidy Turley’s chief executive officer, in an announcement on the deal.

The deal effectively sees DTZ become the third largest property services firm in the world by revenue. The combination of its European and Asian activities with the American activities of Cassidy Turley is a business with revenues of more than $2.9 billion. That compares to CBRE, the world’s largest services firm with $8.7 billion of revenue, and Jones Lang LaSalle, the second largest with revenues of about $5 billion.

In the announcement, Cassidy Turley said the merger “presents a minimal overlap in leadership and market coverage in the US.” Stettinius will work closely with Tod Lickerman, DTZ’s global CEO, and former CBRE boss Brett White, who joined following DTZ’s buyout, to integrate the businesses. The deal was advised by Challenger Capital Group and JPMorgan Securities.

The purchase sees DTZ add 4,000 staff across 60 US offices that worked on transactions valued at $25.8 billion and managed 400 million square feet of real estate during 2013. The enlarged platform will have more than 28,200 staff. “As a result, the firm will be able to more effectively serve its clients and compete for new business anywhere in the world,” the firm stated.

DTZ was acquired by the TPG-led consortium for $1.215 billion in an all-cash deal, which ended a turbulent few years for the firm following the global financial crisis.