ING Group, the Dutch-based financial services institution, said today that it has decided to sell the “majority” of its ING Real Estate Investment Management (ING REIM) businesses in two separate transactions worth more than $1 billion.
In its Tuesday announcement, ING stated that it has reached an agreement to sell ING REIM Europe, ING REIM Asia, and Clarion Real Estate Securities (CRES), its U.S. based-real estate securities manager, to Los Angeles headquartered CB Richard Ellis Group. The transaction is worth approximately $1 billion.
Additionally, Lightyear Capital, a New York-based private equity firm focused on North American middle-market financial services companies, and Clarion Partners management have partnered up to purchase the Clarion Partners firm from its parent company for about $100 million, ING said in the Feb. 15 press release.
Jan Hommen, CEO of ING Group, said in the announcement that the transactions will allow the firm to “continue to deliver on [its] strategic objectives of reducing exposure to real estate, simplifying [the] company and further strengthening [its] capital base.”
Alternately, in a separate statement, Brett White, CB Richard Ellis’ CEO, said that the commercial real estate (CRE) services firm benefits significantly from the addition ING REIM. Particularly, it will assist it in meeting the “needs of institutional investors across global markets with a full spectrum of investment programs and strategies.”
As of Dec. 31, ING REIM had about $59.8 billion in assets under management. CB Richard Ellis, however, had about $37.6 billion under its umbrella.
Shines the light
In Lightyear Capital’s transaction, which will bring the nearly 29-year-old Clarion Partners and its more than $22 billion in assets under management to the firm, is set to establish a partnership between management and executives.
Specifically, Steve Furnary, chairman and CEO of Clarion Partners, will remain in his current role and will serve on the company’s Board along with Lightyear’s Don Marron, its chairman and lead director.
“Lightyear is the perfect financial partner for Clarion Partners”, Furnary said in a separate announcement. “The team at Lightyear are specialists in the financial services industry and have great insights into our business.”
Furthermore, according to ING Group, both transactions will close in the second half of 2011. Both are subject to approvals by “certain stakeholders including various regulators,” the firm stated.