Singapore Fund Asks U.S. Warehouse Operator for Strategic Review -- Update
December 01 2016 - 9:22AM
Dow Jones News
By P.R. Venkat
SINGAPORE -- Global Logistic Properties Ltd. said Thursday it is
undertaking a strategic review, a move that could lead to a sale of
the $7 billion firm that is the second-biggest owner of warehouses
in the U.S.
Singapore-listed GLP said that it has hired J.P. Morgan Chase
& Co. to undertake the review following a request from its
largest shareholder, a unit of Singapore's $344 billion
sovereign-wealth fund GIC Pte. Ltd. The Singaporean sovereign fund
owns 37% of GLP, which has a $7 billion market capitalization, and
a possible sale of its stake would trigger a mandatory offer for
all of the company's shares under Singapore's takeover rules.
GLP has grown into one of the world's biggest logistics
companies through a series of acquisitions with backing from the
Singaporean sovereign fund and other institutional investors.
Demand for sophisticated logistics operations has grown on the back
of the expansion of e-commerce globally and GLP has targeted the
U.S. and China, the two biggest online shopping markets for its
expansion. It manages logistics assets worth close to $40 billion
across the U.S., China, Japan, and Brazil.
GLP has been one of the market's biggest buyers in recent years
for logistics assets with a particular focus on the U.S. and China.
In late 2014, it made its biggest investment in the U.S. by paying
$8.1 billion to Blackstone Group LP for a collection of U.S.
warehouse and logistics properties called IndCor. In September of
this year, it added to those holdings by purchasing a $1.1 billion
portfolio of U.S. warehouses from Hillwood Development Co.
These acquisitions have made GLP the second-largest owner of
warehouses in the U.S. after San Francisco-based real-estate
investment trust Prologis Inc.
GLP has been aggressively expanding in the U.S. over the last
two years, as the rise of online shopping drives up the values of
distribution centers.
In China, GLP manages $12.8 billion worth of assets including
facilities in top-tier cities including Beijing, Shanghai, and
Suzhou.
"As part of the strategic review, the company, through J.P.
Morgan, is in the process of making preliminary approaches to
various parties to evaluate the viability of options available for
its business," GLP said in a filing to the Singapore stock
exchange.
GLP's statement said that no "definite transaction" has been
entered into with any party and that there was no assurance that
any transaction will result from the strategic review.
GIC, the biggest shareholder in the logistics company, is one of
the world's biggest sovereign funds and has parked more than
one-third of its investments in the U.S. It owns stakes in
Citigroup Inc. and UBS Group AG. According to the Sovereign Wealth
Fund Institute, GIC oversees about $344 billion in assets, making
it the world's eighth-largest sovereign fund.
Write to P.R. Venkat at venkat.pr@wsj.com
(END) Dow Jones Newswires
December 01, 2016 09:07 ET (14:07 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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