SYDNEY-Instead of an outright transfer, locally-based UGL Ltd. has purchased the trading operations from London-based DTZ Holdings plc for about $121 million. Prior to the sale, the DTZ holding company went into administration (similar to bankruptcy in the United States).
On Nov. 8, DTZ had chosen UGL Services to take over, a move that will create a property management division with revenues of almost $2 billion. On Nov. 7, the shares of DTZ had plunged about 90% to $5 per share when the firm announced that given its level of debt there was minimal share value.
An administrator was appointed Sunday to the DTZ holding company. Its shares have been dropped from the Official List of the UK Listing Authority. The holding company said in a statement this morning that the transaction completed Sunday will realize no value from the ordinary shares.
Richard Leupen, managing director and CEO of UGL, said combining the firms will create one of the world’s largest property services businesses by revenue, while allowing for a bigger global footprint. “We see significant opportunities for growth in Asia, particularly in China, where DTZ holds the leading market position in property services with 1,300 personnel in 18 cities,” Leupen said in a statement. ““The global trend to outsourcing is continuing and our clients are increasingly demanding an integrated end-to-end service offering which can be delivered by a single solutions provider across their entire global property portfolio.”
Before the transaction, DTZ had offices in 145 cities in 43 countries. UGL Ltd. said the acquisition will be fully debt funded from new debt facilities. Goldman Sachs acted as financial advisor to UGL on the transaction.
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