CHICAGO and DALLAS, March 19,
2019 /PRNewswire/ -- Jones Lang LaSalle Incorporated
(NYSE: JLL) and HFF, Inc. (NYSE: HF) today announced that they have
entered into a definitive agreement under which JLL will acquire
all the outstanding shares of HFF in a cash and stock transaction
with an equity value of approximately $2
billion. The transaction has been unanimously approved by
the boards of directors of both companies.
HFF is one of the largest and most successful commercial real
estate capital markets intermediaries in the U.S., marked by
decades-long relationships with clients, a talented leadership team
and best-in-class capital markets advisors. Since 1998, HFF has
closed more than $800 billion in over
27,000 transactions, achieving record revenue in 2018 of more than
$650 million. Mark Gibson, CEO of HFF, will join JLL as CEO,
Capital Markets, Americas and Co-Chair of its Global Capital
Markets Board.
"Increasing the scale of our Capital Markets business is one of
the key priorities in our Beyond strategic vision to drive
long-term sustainable and profitable growth. The combination with
HFF provides a unique opportunity to accelerate growth and
establish JLL as a leading capital markets intermediary, with
outstanding capabilities," said Christian
Ulbrich, Global CEO of JLL. "We have long admired HFF for
its expertise and leading reputation in the industry, as well as
its client-first culture of teamwork, ethics and excellence, which
aligns with our own. I believe that combining our organizations
will deliver a range of compelling benefits for our clients,
employees and shareholders."
"This is a terrific transaction for our shareholders, providing
them with an immediate cash payment and the opportunity to
participate in the long-term value of the combined company," said
Gibson. "In addition, we believe the combination with JLL will
create a superior platform for our shareholders, clients and
employees than either company would have independent of the other
and will significantly accelerate our firm's strategic plan. JLL's
team-oriented culture with the additional standards of high
character and integrity are an excellent match with the HFF
culture, which has been HFF's fundamental differentiator since its
inception."
Transaction Details
Under the terms of the agreement, HFF shareholders will receive
$24.63 in cash and 0.1505 JLL shares
for each HFF share. Based on the closing price of JLL stock of
$163.02 on March 18, 2019, the cash and stock consideration
to be received by HFF shareholders at closing is valued at
$49.16 per HFF share. The share price
represents a premium of approximately 22 percent and 25 percent
compared to the volume weighted average price of HFF over 60 and 90
trading days, respectively, and a premium of approximately 6
percent over the closing stock price on March 18, 2019 (before the positive impact of the
$1.75 per share special dividend
declared on January 31, 2019 and paid
on February 27, 2019). Upon closing
of the transaction, JLL shareholders are expected to own
approximately 87 percent of the combined company, and HFF
shareholders are expected to own approximately 13 percent. All
seven Executive Committee members of HFF have agreed to vote their
shares, representing 3 percent ownership of HFF, in favor of the
transaction. Key HFF senior leaders and capital markets advisors
have entered into 3-4 year commitments related to employment,
non-competition and/or retention. Finally, JLL anticipates adding
one of HFF's existing directors to JLL's Board of Directors
effective as of the closing of the transaction.
JLL intends to fund the cash portion of the purchase price
consideration with a combination of cash reserves and its existing
syndicated credit facility. The combination is expected to deliver
significant run-rate synergies, estimated at approximately
$60 million over two to three
years.
The transaction is expected to close in the third quarter of
2019, subject to HFF shareholder approval and customary closing
conditions, including regulatory review. The transaction is not
contingent upon receipt of financing.
Compelling Strategic Rationale and Long-Term Value
Creation
Through this combination, JLL will significantly bolster its
full-service Capital Markets services to clients. The transaction
will allow JLL to rapidly scale its U.S. Capital Markets presence,
accelerate growth of its debt advisory business in Europe and Asia
Pacific and drive increased operating efficiency
globally.
HFF shareholders will receive attractive value for their HFF
shares, combining an immediate cash element with the opportunity to
participate in the future success and high growth potential of JLL.
HFF shareholders will benefit from owning shares in a global
organization with a variety of additional services to offer
clients, including industry-leading agency leasing, property
management, valuations and project management services.
The combination of JLL and HFF will create a platform that
attracts, develops and retains the best talent in the industry.
Additionally, the combination of the companies' complementary
investments in technology will further strengthen JLL's digital
capabilities, reinforcing its position as a digital leader with
superior team connectivity, improved back-end processes and
best-in-class client tools.
This acquisition is expected to create long-term strategic value
for both JLL and HFF investors. It will be accretive to adjusted
earnings per share in the first full financial year after
completion and generate strong pro forma cash flow, allowing for
consistent and timely deleveraging.
Advisors
JP Morgan is serving as exclusive financial advisor for JLL, and
Sidley Austin LLP as legal counsel. Morgan Stanley & Co. LLC is
acting as exclusive financial advisor for HFF, and Dechert LLP as
legal counsel.
Webcast
Management will offer a live webcast for shareholders, analysts
and investment professionals at 10:00 AM
Eastern Time. The link to the webcast can be accessed at the
JLL Investor Relations website: ir.jll.com.
Conference Call Details
Management will also conduct a conference call. If you are
unable to join the live webcast and would like to participate in
the teleconference, please dial into one of the following phone
numbers five to ten minutes before the start time (the conference
ID will be required):
United States callers: +1 877
701 6182
International callers: +1 647 689 5462
Conference ID: 1858889
About JLL
JLL (NYSE: JLL) is a leading professional services firm that
specializes in real estate and investment management. Our vision is
to reimagine the world of real estate, creating rewarding
opportunities and amazing spaces where people can achieve their
ambitions. In doing so, we will build a better tomorrow for our
clients, our people and our communities. JLL is a Fortune 500
company with annual revenue of $16.3
billion, operations in over 80 countries and a global
workforce of over 90,000 as of December 31,
2018. JLL is the brand name, and a registered trademark, of
Jones Lang LaSalle Incorporated. For further information, visit
jll.com
About HFF
Through its subsidiaries, Holliday
Fenoglio Fowler, L.P., HFF Real Estate Limited, HFF
Securities L.P. and HFF Securities Limited, HFF operates out of 26
offices and is one of the leading and largest full-service
commercial real estate financial intermediaries, providing
commercial real estate and capital markets services to both the
consumers and providers of capital in the commercial real estate
sector. HFF offers clients a fully-integrated capital markets
platform including debt placement, investment advisory, equity
placement, funds marketing, M&A and corporate advisory, loan
sales and commercial loan servicing.
Forward-Looking Statements
This communication may contain certain statements that predict
or forecast future events or results, or intentions, beliefs and
expectations or predictions for the future of JLL (the "Company")
and HFF ("HFF"), which are forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of 1995,
including statements with respect to the anticipated effects of the
proposed transaction, expectations with respect to synergies, the
proposed transaction's anticipated benefits to stockholders, the
anticipated timing of the closing of the proposed transaction and
plans with respect to the leadership of the combined company
following the closing of the proposed transaction. Words such as
"believes," "expects," "anticipates," "estimates," "intends,"
"plans," "seeks," "projects" or words of similar meaning, or future
or conditional verbs, such as "will," "should," "would," "could,"
"may" or variations of such words and similar expressions are
intended to identify such forward-looking statements, which are not
statements of historical fact or guarantees or assurances of future
performance. However, the absence of these words or similar
expressions does not mean that a statement is not
forward-looking.
Actual results could differ materially from those projected or
forecast in the forward-looking statements. The factors that could
cause actual results to differ materially include, without
limitation, the following risks, uncertainties or assumptions: the
satisfaction of the conditions precedent to the consummation of the
proposed transaction, including, without limitation, the receipt of
HFF stockholder and regulatory approvals on the terms desired or
anticipated; unanticipated difficulties or expenditures relating to
the proposed transaction, including, without limitation,
difficulties that result in the failure to realize expected
synergies, efficiencies and cost savings from the proposed
transaction within the expected time period (if at all); potential
difficulties in the Company's and HFF's ability to retain employees
as a result of the announcement and pendency of the proposed
transaction; the Company's ability to obtain and maintain an
investment grade credit rating and obtain financing on the
anticipated terms and schedule; risks relating to the value of the
Company's shares to be issued in the proposed transaction;
disruptions of the Company's and HFF's current plans, operations
and relationships with customers caused by the announcement and
pendency of the proposed transaction; legal proceedings that may be
instituted against the Company and HFF following announcement of
the proposed transaction; and other factors described in the
Company's annual report on Form 10-K for the fiscal year ended
December 31, 2018, which was filed
with the Securities and Exchange Commission (the "SEC") on
February 26, 2019, HFF's annual
report for the fiscal year ended December
31, 2018, which was filed with the SEC on February 28, 2019, and other filings made by the
Company and HFF from time to time with the SEC. The factors
described in such SEC filings include, without limitation: the
effect of political, economic and market conditions and
geopolitical events; the logistical and other challenges inherent
in operating in numerous different countries; the actions and
initiatives of current and potential competitors; the level and
volatility of real estate prices, interest rates, currency values
and other market indices; the outcome of pending litigation; and
the impact of current, pending and future legislation and
regulation.
Neither the Company nor HFF undertakes, and each of them
expressly disclaims, any duty to update any forward-looking
statement whether as a result of new information, future events or
otherwise, except as required by law. Readers are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date hereof.
No Offer or Solicitation
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended, and otherwise in accordance with
applicable law.
Additional Information Regarding the Proposed Transaction and
Where to Find It
The proposed transaction involving the Company and HFF will be
submitted to the stockholders of HFF for their consideration. In
connection with the proposed transaction, the Company will prepare
a registration statement on Form S-4 that will include a proxy
statement/prospectus for HFF's stockholders to be filed with the
SEC, and HFF will mail the proxy statement/prospectus to its
stockholders and both the Company and HFF will file other documents
regarding the proposed transaction with the SEC. However, such
documents are not currently available. BEFORE MAKING ANY VOTING OR
ANY INVESTMENT DECISION, AS APPLICABLE, INVESTORS AND SECURITY
HOLDERS OF THE COMPANY AND/OR HFF ARE URGED TO READ THE DEFINITIVE
PROXY STATEMENT / PROSPECTUS REGARDING THE PROPOSED MERGER
TRANSACTION AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED
WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION. Investors and securityholders may obtain free
copies of the definitive proxy statement/prospectus, any amendments
or supplements thereto and other documents containing important
information about each of the Company and HFF, once such documents
are filed with the SEC, through the website maintained by the SEC
at www.sec.gov. Copies of the documents filed with the SEC by the
Company will be available free of charge under the "Investor
relations" section of the Company's website located at
http://www.jll.com or by contacting the Company's Investor
Relations Department at (312) 252-8943 or
JLLInvestorRelations@jll.com. Copies of the documents filed with
the SEC by HFF will be available free of charge under the "Investor
Relations" section of HFF's website located at http://www.hfflp.com
or by contacting HFF's Investor Relations Department at (718)
852-3500 or InvestorRelations@hfflp.com
Participants in the Solicitation
The Company and HFF and their respective directors and executive
officers, certain other members of their respective management and
certain of their respective employees, may be deemed to be
participants in the solicitation of proxies in connection with the
proposed merger transaction. Information about the directors and
executive officers of HFF is set forth in its proxy statement
for its 2018 annual meeting of stockholders, which was filed with
the SEC on April 28, 2018, and its
annual report on Form 10-K for the fiscal year ended
December 31, 2018, which was filed with the SEC on
February 28, 2019, each of which can be obtained free of
charge from the sources indicated above. Information about the
directors and executive officers of the Company is set forth
in its proxy statement for its 2018 annual meeting of stockholders,
which was filed with the SEC on April 19,
2018, and its annual report on Form 10-K for the fiscal
year ended December 31, 2018, which was filed with the SEC on
February 26, 2019, each of which can be obtained free of
charge from the sources indicated above. Other information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, will be contained in the definitive proxy
statement/prospectus and other relevant materials to be filed
with the SEC when they become available.
Contacts
Investors:
Grace Chang
JLL
Managing Director, Corporate Finance & Investor Relations
(312) 228-2251
Grace.Chang@jll.com
Myra F. Moren
HFF Managing Director, Investor Relations
(713) 852-3500
MMoren@hfflp.com
Media:
Gayle Kantro
JLL Senior
Director, Global Communications
(312) 228-2795
Gayle.Kantro@am.jll.com
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SOURCE JLL-IR