J&J Worldwide Services, a portfolio company of Arlington Capital Partners, has entered into a definitive agreement to be acquired by CBRE Group, Inc., a commercial real estate services and investment firm.
The initial purchase price is $800 million in cash, plus a potential earn-out of up to $250 million, payable in 2027 and subject to the acquired business meeting certain performance thresholds, the company said.
“Becoming part of CBRE provides J&J a great opportunity to continue building upon and expanding the solutions we provide our military customers at mission-critical facilities around the world,” said J&J Worldwide Services CEO Steve Kelley. “Arlington Capital Partners provided the industry expertise and guidance needed to scale our solutions at an unrivaled pace and prepare us for continued growth. We are excited about combining our capabilities and track record with CBRE’s to enhance our commitment to serving those that serve our nation.”
In 2024, J&J is projected to produce over $525 million of revenue and $65 million of EBITDA, continuing its track record of low double-digit annual growth. J&J primarily serves the Defense Department and employs over 3,300 people worldwide.
The company serves over 250 hospitals, clinics and military installations primarily in the U.S., Europe, Asia, the Caribbean and the Middle East.
“The acquisition is consistent with key elements of our M&A strategy that focus on enhancing our technical services capabilities, increasing revenue resilience and secular growth and expanding our government client base within Global Workplace Solutions,” said Bob Sulentic, chair and CEO of CBRE. “We are adding a company with deep government contracting experience, long-term customer relationships and a 50-year record of outstanding technical service delivery.”
Specifically, J&J partners with U.S. federal civilian and defense agencies to deliver mission critical services across healthcare and medical solutions, mission support solutions, and engineering solutions.
“J&J is well-positioned to continue benefitting from strong secular tailwinds, including modernization of US Department of Defense infrastructure, and increasingly as it relates to addressing our near-peer competitors,” said Sean Thompson, chief growth officer of J&J Worldwide Services. “Joining CBRE will allow us to build on our record of double-digit annual growth, while positioning J&J to expand our global capabilities to better serve our customers.”
J.P. Morgan Securities LLC is J&J’s financial advisor, and Sheppard Mullin Richter & Hampton LLP is the legal advisor for both J&J and Arlington Capital Partners, according to the company. Citi is CBRE’s financial advisor, while Simpson Thacher & Bartlett LLP and ArentFox Schiff LLP are its legal advisors.
Closing of the acquisition is still subject to obtaining applicable regulatory clearances and other customary closing conditions, and is expected in the coming months.