A major Texas construction company will sell its Dallas homebuilding business for $15 billion to a company with a record of building high-rise office buildings in the United States.
Davis Construction is the largest Texas construction firm and a longtime leader in high-rises in Dallas, with offices in several of the nation’s largest metropolitan areas, including Washington, D.C. Davis is also a major player in other sectors, including aerospace, transportation and the construction of hospitals and other facilities.
Davis will be able to sell about 1,100 employees, and its existing customers will benefit.
The deal is expected to close by the end of the year.
The news comes a week after a report from the Dallas Morning News that Davis Construction was being investigated by the FBI for possible violations of securities laws related to the construction and sale of high-end office buildings.
The company declined to comment on the FBI probe.
Davis has also been accused of being involved in a scheme to steal more than $2 billion from customers of its construction firm.
The allegations against Davis came to light after a complaint by a former Davis employee who alleged that he was paid for work on the Davis construction site by the company’s chief executive officer, Mark Gebauer, in a secret arrangement that involved a $40,000 monthly payment from the company, according to a letter the former employee wrote to a federal prosecutor.
Davis filed for bankruptcy protection in 2012.
The FBI investigation is one of several probes into Davis and other construction firms over allegations of money laundering and tax evasion.
Davis, which was founded in 1902 and has been listed on the New York Stock Exchange since 2009, was one of the first firms to build high-density office buildings around the world, and it continues to build in cities including Atlanta, Dallas and San Francisco.
The Dallas Times reported in December that a new investigation by the Justice Department found that Davis was “a notorious tax-evasion ring.”
The company is also facing investigations by the Federal Election Commission and the Securities and Exchange Commission.
The federal probe began after the New Orleans Times-Picayune published a report that alleged that Davis used shell companies in Texas and elsewhere to avoid taxes on nearly $200 million in profit it earned from the sales of office buildings and other office-related items to wealthy investors.
In its investigation, the New Jersey Division of Criminal Investigation said it was looking into allegations that the company concealed $25 million in revenue from a Texas sales tax that was due on the purchase of Davis’ headquarters, the Journal-World reported.
Davis said in a statement that the sale is the culmination of a strategic decision made by the Board of Directors to sell the company for a more stable and sustainable business model.
Davis was founded by founder and president Robert Gebaur in 1902, and the company went public in 2007.
The firm was once among the largest construction companies in the world and also served as a major broker in real estate.
It’s headquarters are in downtown Dallas, which is one hour east of downtown Washington.
Davis had revenues of about $4.6 billion in 2013, according the company.
It has more than 300 employees in more than 100 offices in the U.S., the U-K.
and Germany, and is based in Austin, Texas.
The Associated Press reported in January that the FBI had begun investigating Davis for potential criminal conduct related to its handling of the sale of a Texas tax-exempt mortgage-backed security that it purchased from a bank in 2007 for about $300 million.
The government investigation also involves a probe by the Texas Department of Banking, which had been investigating Davis since 2005 for potential violations of bank lending laws.
The AP reported in October that the Texas investigation began after a former employee of Davis filed a complaint with the federal bank regulator.
The complaint alleged that the bank had not followed procedures for approving transactions for Davis that were not approved by the firm, including transactions involving the sale or use of a bank account that did not have any funds in it.
The former employee, James E. Taylor, told the regulator that he had been fired after complaining to management about Davis’ conduct, and that he believed Davis was taking advantage of him and other employees by not properly verifying their identities and credit histories.
The investigation also has focused on the company and its chief executive, Mark Giordano, who was ousted in 2011 after the AP reported that he used company funds to pay a personal lawyer for a trip to Europe.
Giordana, who also has denied wrongdoing, has denied any wrongdoing.