Bilfinger has confirmed the sale of its building and facility segment to EQT in a €1.4bn deal.
The deal was signed earlier today, as revealed by Estates Gazette, but is subject to approval from “responsible authorities”.
The Swedish private equity firm has bought the business through its EQT VII fund.
EQT said: “The European real estate services sector is a promising market, which is set to benefit from the growth rate of outsourced real estate services,” adding: “The focus going forward lies in further developing the integrated services offering across its growing European platform.”
EQT said it intends to take “a long-term-oriented, responsible and sustainable participation approach” to its ownership.
Andreas Aschenbrenner, partner at EQT Partners, added: “The plan is to expand building and facility’s already strong platform by organic growth as well as via acquisitions and to grow stronger than the market in Europe. The intention is to create a European leader in the real estate services sector and EQT will invest in the company accordingly. To achieve this, we look forward to working together with the experienced and successful management of all the three divisions.”
The three divisions – building, facilities management and real estate – employ more than 20,000 people.
Bilfinger stressed that its core business is industrial services “and Bilfinger will fully focus on this area in the future”.
Chief financial officer Axel Salzmann said: “The sale of the segment generates the greatest value for Bilfinger and opens up new perspectives. With additional liquidity, we will expand our position as market leader for industrial services in the process industry through targeted acquisitions and investments in the future… At the same time, building and facility gets a growth-oriented investor with proven expertise in the services sector.”
The payment by EQT to Bilfinger for the division is complex. Bilfinger and EQT have agreed a “vendor claim agreement” of €100m with annual interest of 10% on maturity. A further portion of the purchase price of approximately €200m “will be transformed into an instrument similar to an earn-out” and entitles Bilfinger to 49% of the resale proceeds from EQT and will give Bilfinger a long-term interest in the success of the business.
Gerry Hughes, chief executive of Bilfinger GVA, said: “Our leading market position in the UK as a real estate advisory business and our growing business in Europe, combined with the support of our new owner EQT present an opportunity to build on what has just been our most profitable year yet.”
• To send feedback e-mail david.hatcher@estatesgazette.com or tweet @hatcherdavid or @estatesgazette
