Real estate services firm JLL is acquiring smaller peer HFF in a $2bn (€1.76bn) deal.
JLL, which operations in over 80 countries, said the acquisition of HFF will accelerate its growth in the capital markets business.
HFF operates out of 26 offices, providing commercial real estate and capital markets services to both the consumers and providers of capital in the commercial real estate sector.
Mark Gibson, CEO of HFF, will join JLL as CEO, capital markets, Americas and co-chair of its global capital markets board.
In a joint statement, the companies said they have entered into an agreement under which JLL will acquire all the outstanding shares of HFF in a cash and stock transaction.
HFF shareholders will receive $24.63 in cash and 0.1505 JLL shares for each HFF share. The amount being paid for the HFF shares represents a 6% premium to the last closing price.
Following the deal, JLL shareholders are expected to own 87% of the combined company.
JLL said it intends to fund the cash portion of the deal with a combination of cash reserves and its existing syndicated credit facility.
Christian Ulbrich, global CEO of JLL, said: “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.”
“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,” Gibson said.
“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.”