Newmark sells for less than rumored estimate

BGC Partners pays $63M in cash, plus stock

TRD New York /
Oct.October 20, 2011 04:10 PM

Howard Lutnick’s BGC Partners is paying $63 million in cash and $2.3 million in stock for Newmark & Company Real Estate, BGC said in a filing with the Securities and Exchange Commission last week.

BGC could pay an additional 4.83 million shares, which today have a value of $33.38 million, to Newmark shareholders, if certain incentive goals are reached, the company said.

BGC closed Friday on the acquisition of Newmark including the company’s majority interests in 13 affiliated companies around the United States. Newmark, whose partners include CEO Barry Gosin and principal Jeffrey Gural, is known as Newmark Knight Frank in the U.S., and is affiliated with the global brokerage Knight Frank, based in London. BGC announced in April it would buy Newmark. At the time, the purchase price was rumored to be between $125 million and $200 million.

Using the $6.91 share price of the stock at the closing this past Friday, the maximum sale price of the brokerage was $98.7 million. That includes the $63 million in cash plus 339,000 shares of stock, equal to $2.3 million, and the maximum of 4.83 million shares over five years, equal to $33.38 million.

“The former shareholders of Newmark will also be entitled to receive up to an additional approximately 4.83 million shares of stock over a five-year period if Newmark achieves certain enumerated gross revenue targets post-closing,” the release said. BGC will buy the non-controlling interest in the remaining Newmark offices around the country at a later date, the firm said.

BGC, through a spokesperson, declined to comment.

Joseph Harbert, COO of the New York office of global commercial firm Cushman & Wakefield, said he was not familiar enough with the economics of the deal to comment on it, but noted Newmark has flourished in its hometown.

“Newmark has done well in New York,” Harbert said. “Barry [Gosin] has built a good local firm that is very competitive.”


Related Articles

arrow_forward_ios
Director of Research & Analytics for CBRE Tri-State Nicole LaRusso, Vice Chairman & Director at Savills David Goldstein, and President of Newmark Knight Frank's Tri-State region David Falk

“For years we all laughed at them”: office brokers warm to virtual tours

“For years we all laughed at them”: office brokers warm to virtual tours
Director of Research & Analytics for CBRE Tri-State Nicole LaRusso, Vice Chairman & Director at Savills David Goldstein, and President of Newmark Knight Frank's Tri-State region David Falk

How to open up our offices on tonight’s TRD Talk

How to open up our offices on tonight’s TRD Talk
Newmark Grubb Knight Frank CEO Barry Gosin (Photo by Kelly Sullivan/Getty Images for BenchMarks)

Newmark profit down, revenue up

Newmark profit down, revenue up
TSCG and SCG Retail's David Firestein, Meridien Retail Leasing's James Famularo and Newmark Knight Frank's Jeffrey Roseman

How to restart retail on today’s TRD Talk

How to restart retail on today’s TRD Talk
“Be very careful what you ask for,” top broker warns borrowers seeking relief

“Be very careful what you ask for,” top broker warns borrowers seeking relief

“Be very careful what you ask for,” top broker warns borrowers seeking relief
Barry Gosin, Sandeep Mathrani and Christian Ulbrich

WeWork taps JLL, Newmark to help negotiate rent relief

WeWork taps JLL, Newmark to help negotiate rent relief
From left: Realogy's Ryan Schneider, Cushman & Wakefield's Brett White and Newmark Knight Frank's Barry Gosin (Credit: iStock)

Brokerage stocks plunge amid market turmoil

Brokerage stocks plunge amid market turmoil
125 Park Avenue (Credit: Google Maps, iStock)

Newmark hires nurse to screen visitors, employee tests positive for Coronavirus

Newmark hires nurse to screen visitors, employee tests positive for Coronavirus
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...