Feb. 20, 2012, 9:51 p.m. EST
Grubb & Ellis Enters Into Strategic Transaction With BGC Partners
Upon completion, Grubb & Ellis believes the acquisition by BGC will bring the much-needed scale and resources the company had been seeking through its strategic process. The partnership with BGC, a financially strong and respected organization with a deep commitment to the commercial real estate markets, will position Grubb & Ellis to become part of a well-capitalized global platform.
“Following a thorough and rigorous process and the evaluation of all available options, we determined that a partnership with BGC provides the best platform for our brokerage professionals, employees and clients,” said Thomas P. D’Arcy, president and chief executive officer of Grubb & Ellis. “We believe the transaction will be seamless for our clients and we expect no disruption to the company’s operations. Furthermore, we believe our professionals and clients will benefit greatly by being part of the BGC organization, which, with its recent acquisition of Newmark Knight Frank, will bring together two strong brands to create a powerhouse in the commercial real estate space. BGC’s purchase of the company’s senior debt and its willingness to provide incremental financing to ensure the smooth execution of the sale process demonstrate its commitment to the success of the Grubb & Ellis business.”
Grubb & Ellis intends to implement the transaction as an asset sale under Section 363 of the U.S. Bankruptcy Code. To that end, the company has commenced Chapter 11 proceedings in the U.S. Bankruptcy Court for the Southern District of New York. Grubb & Ellis expects business to continue without disruption as it completes the “363” sale process as expeditiously as possible. The company has simultaneously filed motions requesting that the Court, among other things, approve sale procedures and fix a hearing date and time to approve a sale. Additionally, the company has filed a series of motions to facilitate ongoing operations.
D’Arcy continued, “We thank our outstanding team of professionals and our clients for the faith and loyalty they have shown in Grubb & Ellis through this process, and we are pleased to have found such a strong partner who can provide our company with financial stability and deeply enhanced opportunities. Our track record for exceptional client service will continue, and we look forward to future growth and success under new ownership.”
BGC has committed to provide Grubb & Ellis with “debtor-in-possession” (“DIP”) financing to support the company’s operations throughout the “363” sale process. Following Court approval, the DIP financing, combined with funds generated by the company’s ongoing operations, will be used to support the business through the consummation of the sale.