GLP Shareholders Okay US$11.6 Billion Buyout

Shareholders of Global Logistics Properties (GLP), the Singapore-listed logistics company and the largest operator of warehouses in China, last week approved the proposed US$11.6 billion buyout of the firm by a consortium led by developer China Vanke Co and Chinese fund Hillhouse Capital.

GLP warehouse in Changshu, Jiangsu province
GLP warehouse in Changshu, Jiangsu province

The transaction is Asia’s biggest-ever private equity acquisition by value.
In a statement, GLP said 99.96% of the total number of shares voted by shareholders present and voting in person or by proxy at the meeting were in favour of the buyout proposal, which included Singapore’s sovereign wealth fund, GIC, which is the single largest shareholder in GLP with a 36.8% stake.

Nesta Investment Holdings MidCo is registered on the Cayman Islands
The consortium, The Nesta Investment Holdings MidCo, earlier proposed the buyout in July. Other members of the consortium include GLP co-founder and chief executive officer Ming Mei and Goldman Sachs’ former China chairman Fang Fenglei.
GLP, which will delist from the Singapore bourse early next year, spun out from the former Asian business of the world’s biggest industrial real estate operator Prologis, which was listed in Singapore in October 2010.
The company owns and manages logistics facilities such as warehouses, controlling 55% share of China’s industry of modern logistics facilities, according to a 2015 report by Cushman & Wakefield.
Operations are the foundation of its business model, though it has also expanded into warehouse development and fund management.

China is still facing a shortage of modern warehouses
The China market has been the biggest revenue contributor for GLP, as it owns 17.5 million square meters of completed warehouse area. By June this year, as much as 57 % of the firm’s net asset value came from the Chinese market, while 26% was from Japan, 9% from the U.S. and 8% from Brazil.
An earlier report on the deal in the South China Morning Post (SCMP) said that "Investors are heading to the Chinese logistics sector as China is already the world’s largest e-commerce market, but the country faces a shortage of modern warehouses."

Nol van Fenema

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