DTZ launches sale after bid talks collapse
DTZ, the debt-laden property agent, has put itself up for sale, just two days after announcing that its majority shareholder walked away from a deal.
DTZ confirmed in May that Saint Georges Participations (SGP), the French group that owns 55 per cent of DTZ, had made a bid in partnership with the real estate arm of BNP Paribas in a deal that valued the company at £162m. Talks ground to a halt on Monday when DTZ announced that SGP had walked away, sending DTZ’s shares tumbling 13 per cent.
But DTZ said yesterday that it has received “preliminary indications of interest from a number of parties” potentially interested in acquiring DTZ and would begin a formal sale process.
DTZ along with its peers in the sector were hit by the crisis in 2008 but it has since struggled to recover due to the large amount of debt on its balance sheet, which analysts believe could put off suitors.
DTZ’s net debt has fallen to £64.3m, down from £80m last October, but is still regarded as too high.
The firm also ruled out a break-up: “Those people speculating on the break-up of DTZ clearly don’t understand our business,” a spokesman said yesterday.
Shares closed down 3.3 per cent last night at 22p.
MEET THE ADVISERS:
DAVID ARCH
ORIEL SECURITIES
ORIEL Securities has been appointed adviser and broker to DTZ, with David Arch, head of corporate finance, leading the sale process. He is joined by partners Emma Griffin and Michael Shaw.
Arch has over 25 years’ corporate finance experience advising companies on M&A and capital raising transactions. He spent twelve years working for Schroders’ corporate finance division, before joining Close Brothers in 1996 as corporate finance director.
Oriel Securities’ reputation has grown since it was established as a boutique investment bank and brokerage in 2002.
In May this year it advised the online gaming firm Sportingbet on its acquisition of Australian peer Centrebet in a £117m all-share deal. It also completed the £220m stock market float of Max Property Group in 2009 and has worked on several other equity raisings.