Insignia and CB Richard Ellis Agree in Principle to Settle Litigation

NEW YORK CITY-Insignia Financial Group Inc. and CBRE Holding Inc. reached an agreement in principle with Insignia stockholders to settle a purported class action litigation. The suit was filed against Insignia, the directors of Insignia, CBRE Holding and an affiliate and Island Fund I LLC. The plaintiffs sought additional disclosure surrounding the agreement entered into in late May where Island Fund agreed to purchase all of Insignia’s real estate investment assets, which had a book value of $64.5 million as or March 31. The agreement involved 32 existing properties comprised of office, retail and hotel assets; 5 development properties; one parcel; and two private investment funds. Island Fund is an entity affiliated with Insignia CEO Andrew L. Farkas and other Insignia executive officers.

This settlement will not affect the merger consideration to be paid to stockholders of Insignia in connection with the proposed merger between Insignia and CB Richard Ellis, an affiliate of CBRE Holding, or the timing of the special meeting of stockholders of Insignia scheduled for July 22 to vote upon a proposal to adopt the merger agreement. If the merger is approved, the closing of the merger is expected to occur on July 23.If the sale to Island Fund is completed prior to the merger and certain conditions in the merger agreement are satisfied, the consideration in the merger will be increased from $11 to $11.156 per share of common stock of Insignia.

The parties expect to enter into a memorandum of understanding reflecting their agreement in principle within the next few days.