A Chinese consortium on Friday offered more than $11 billion for Singapore’s Global Logistic Properties Ltd, which provides warehouses for the likes of Amazon China and WalMart, as e-commerce drives demand for logistics space.
In filings with the Singapore Exchange, both firms said they were “pleased to announce the proposed acquisition” after GLP selected Nesta Investment Holdings as its preferred bidder.
Under the deal, Nesta would buy GLP shares at Sg$3.38 apiece, valuing the company at around Sg$16 billion ($11.6 billion).
Data compiled by Bloomberg showed the deal will be the biggest private equity buyout of an Asian company by enterprise value.
It would be the second-largest logistics deal this year after China Investment Corp agreed to acquire Blackstone Group LP’s European logistics business for 12.25 billion euros ($13.8 billion) in June, Bloomberg said.
GLP—of which Singapore sovereign wealth fund GIC is the biggest shareholder with an almost 37 percent stake—owns and manages a portfolio of modern logistics facilities in China, Japan, the United States and Brazil. It counts Amazon China, WalMart, Adidas, FedEx and DHL among its clients.
It is also one of the world’s largest real estate fund managers with assets under management of around $39 billion, filings with the Singapore stock exchange said.
The growth of websites such as Amazon and Alibaba means customers can buy anything from mobile phones to sports equipment online and send them straight to loved ones, driving growth in e-commerce.
This has also fuelled demand for state-of-the-art warehouse space worldwide to facilitate such shipments, analysts said.
US-based research firm eMarketer has said online sales are expected to reach $1.9 trillion this year and top $4.0 trillion by 2020.
Nesta is comprised of five Chinese companies, including private equity investment firm HOPU Logistics Investment Management and Bank of China Group Investment.
The deal is expected to be completed on or before April 14 next year, subject to shareholders’ approval.
GIC has assured Nesta it will vote in favour of the buyout. GLP shares closed nearly 22 percent higher Friday after the deal was announced.—AFP