CBRE Prices Stock Offering, Expects $180M

The Los Angeles-based company has granted the underwriters of the stock offering a 30-day over-allotment option to purchase up to 7.5 million additional shares. If the underwriters exercise that option, the offering could generate a total of approximately $207.1 million, according to CBRE's public filings Thursday.

CBRE has declined to comment on the offering, citing SEC regulations that restrict comment on pending offerings. Its prospectus says that it intends to use the proceeds of the offering "for general corporate purposes, which may include the repayment of principal of revolving credit loans and term loans under our senior secured credit agreement."

The $180 million expected to be raised in the offering will give CBRE a financial cushion that it does not need immediately but could need in the future, according to remarks by company executives in its latest earnings conference call. The prospectus for the offering notes, "We are highly leveraged and have significant debt service obligations."

In its SEC filings Thursday, CBRE said that the company "has been informed that affiliates of Blum Capital Partners LP have agreed to purchase an aggregate of approximately 10.6 million shares" of the new stock offering. Blum Capital is already a significant shareholder in CBRE and after the offering will own between 14.6% and 15% of CBRE's stock, depending on whether the underwriters exercise their over-allotment option, according to the public filings.

The 50 million shares of new stock will boost the number of CBRE's outstanding shares to nearly 255 million. The underwriters for the offering are led by Credit Suisse Securities (USA) LLC and Banc of America Securities LLC as joint book-running managers. ABN AMRO Inc., Barclays Capital Inc., HSBC Securities (USA) Inc., Scotia Capital (USA) Inc. and Wells Fargo Securities LLC are co-managers in the offering.