Toronto-based FirstService Corporation has unveiled plans to spin off Colliers International as an independent, publicly traded unit.
Toronto-based FirstService Corporation has unveiled plans to spin off Colliers International as an independent, publicly traded unit.
The board of directors has provisionally approved a plan to separate the group into two real estate services firms: Colliers International, which has a global focus, and FirstService Corporation, which concentrates on residential property management and services in North America.
‘Today we are taking the next bold, but logical, step in unlocking even greater value for FirstService shareholders by separating our company into two, billion dollar public companies, Colliers International and FirstService Corporation,’ Jay Hennick, founder and CEO of FirstService said in a statement.
The proposed transaction will be implemented through a court-approved Plan of Arrangement and is subject to final approval from FirstService's board of directors. Under the plans, the subordinate voting shares of Colliers International and FirstService Corporation will be listed on the Toronto stock exchange and the Nasdaq stock market in the US. The operation will be structured as a tax-free distribution to shareholders.
FirstService said it expects the spin-off will help Colliers International ‘take advantage of internal growth opportunities and industry consolidation in an industry where brand and global capabilities are key competitive advantages’.
Colliers International is active in more than 60 countries and posted pro forma revenue in 2014 of $1.7 bn (€1.5 bn) – including contributions from acquisitions completed during the year. FirstService said the separation will help Colliers create shareholder value by ‘leveraging its position as a top three global leader’ in the real estate services industry. FirstService acquired Colliers International UK as a wholly owned subsidiary in 2012. A year later, Colliers acquired controlling interests in two joint venture partners, boosting its position in the German market.
Following the separation, FirstService Corporation will consist of the current FirstService Residential and FirstService Brands divisions. Pro forma revenue from the North American platform totalled $1.1 bn in 2014, including contributions from acquisitions completed during the year.
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