UPDATE: TCC Sets Merger Vote, Gives Deal Details

Under the terms of the agreement, TCC will become a wholly owned subsidiary of CBRE, keeping its branding and reins for development and investment. The merger will create a 20,000-member strong powerhouse circling the globe, but also generate operational overlaps that both companies are now addressing to drive a smooth transition. In the SEC filing, the deal's outside date for closing is March 19, 2007.

TCC shareholders will vote 9 a.m. Central at the Fairmont Hotel at 1717 N. Akard St. in Downtown Dallas. If the merger's approved, shareholders will get $49.51 in cash for each common share stock, minus interest.

Since the deal was announced, TCC has been making daily filings with the SEC to keep employees and shareholders abreast of the transaction. TCC's executive officers have been entering into stock voting agreements. As of Oct. 25, they held about 2.14 million shares, excluding options, representing about 5.9% of the outstanding common stock. As of Nov. 10, owners of record for 36,465,339 common shares were eligible to vote.

In the SEC filing, TCC will pay $10,000, excluding out-of-pocket expenses, to Georgeson Inc. for the proxy solicitation. "We are working toward completing the merger as quickly as possible," TCC writes in the filing, citing its original timeframe to close in Q4 or early Q1 2007.

The locally based TCC and its Los Angeles-headquartered marriage partner estimate it will take about $2.11 billion to complete the merger and related transactions, including shareholders' payouts, repayment or refinancing of TCC's outstanding debt and all related fees. CB Richard Ellis Services Inc., another wholly owned subsidiary, has a commitment for up to $2.8 billion of senior secured-loan facilities from Credit Suisse Securities LLC and Credit Suisse.

As always, the powerhouse deal's background is in the filing. The first meeting was held April 7, 2005 in Chicago when CBRE president of the Americas Calvin W. Frese Jr. asked TCC's Bill Concannon and a board member about a possible "business combination." The TCC execs put the inquiry before the board at its May 2005 meeting, with the consensus being that it wouldn't pursue a company sale, but it also wouldn't permanently close the door to "discussions with third parties regarding strategic business combinations."

In August 2005, a meeting between the companies' top executives was nixed after a London trade journal published an article speculating that a deal was in the works. TCC chairman and CEO Robert Sulentic not only canceled the meeting, but the talks as well. CBRE's CEO Brett White reinforced its interest and told Sulentic that "CBRE might contact the company later that year."

Talks picked up again in late September 2005, with TCC's board in May 2006 knuckling down to an in-depth discussion about the overture. Last June, CBRE then terminated the talks, but picked them up again in late August after hearing a rumor that TCC was talking to one of its competitors. Hard-line negotiations began in September.

The fast-forward takes the talks to mid-October when CBRE offered $49.51 per share and a $100-million termination fee with the back-up offer being $48.88 per share and a $200-million penalty for a cancellation. The definitive agreement was inked Oct. 30; the announcement hit the streets the next morning.

TCC is on the hook for $40 million if it terminates the takeover for a higher offer. The SEC filing offers a rare look at TCC's actual numbers. It expects earnings per share this year of $2.04, with its growth rate projected at 17.5% through 2010. TCC's 2006 revenues of $1.1 billion translate into a $75-million net income.