CBRE ups stake in Turner & Townsend in project management merger
CBRE Group has set out plans to combine its project management business with its majority-owned subsidiary Turner & Townsend, as it increases its stake in the consultancy to 70%.
On closing the deal, CBRE will own 70% of the combined business, with Turner & Townsend partners holding the remaining 30%.
The cost of the incremental investment in the merged business tallies around $70m (£55.3m), excluding deal costs.
CBRE Group has set out plans to combine its project management business with its majority-owned subsidiary Turner & Townsend, as it increases its stake in the consultancy to 70%.
On closing the deal, CBRE will own 70% of the combined business, with Turner & Townsend partners holding the remaining 30%.
The cost of the incremental investment in the merged business tallies around $70m (£55.3m), excluding deal costs.
CBRE acquired a 60% stake in Turner & Townsend in 2021, in a £960m deal. Since then, Turner & Townsend has grown its revenue at a compound rate of more than 20%.
CBRE’s entire project management business, including Turner & Townsend, produced net revenue of around $3bn in 2023. The group said that since 2021, combined net revenue has grown at a double-digit annual rate with a circa 15% net profit margin.
The combined business will be led by Vincent Clancy, Turner & Townsend’s chairman and chief executive, who will continue to report to a board controlled by CBRE and consisting of senior executives from CBRE and Turner & Townsend.
Clancy will be appointed to CBRE’s board when the deal closes. The transaction is expected to complete around year-end.
Beginning in 2025, CBRE will report its project management arm’s financial results in a new segment separate from the Global Workplace Solutions division, to provide increased transparency for investors.
Bob Sulentic, CBRE’s chair and chief executive, said: “Unifying our project management business will create an offering that is unmatched for its scale and breadth of capabilities, with more than 20,000 employees serving clients in over 60 countries.
“Powerful secular trends, particularly increased spending on infrastructure, green energy, and employee experience, are growth catalysts for this business and we are well positioned to capitalise on this significant opportunity.”
Clancy said: “Our ambition since joining forces with CBRE in 2021 has been to create the premier, differentiated programme, project and cost management capability globally. We have made exceptional progress towards this goal and our revenue and profit have grown significantly in the last three years.
“Turner & Townsend’s momentum will continue to grow with the combining of two great businesses into one integrated, pure-play project management capability. Our combined depth of talent and resources, global footprint, sector expertise and commitment to excellence will be second to none in project and programme management.”
