A Chinese-backed consortium made an offer for one of the world's largest warehousing companies, Global Logistic Properties Ltd., in what would be the biggest deal ever recorded in Southeast Asia.
The deal will value the Singapore-listed firm at about 16 billion Singapore dollars (US$11.6 billion), excluding debt. It would top a 2008 telecommunications deal in Malaysia that was worth about US$7.9 billion, excluding debt, according to data provider Dealogic.
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The consortium, which includes GLP's chief executive as well as Chinese investors Hillhouse Capital Group and Hopu Investment Management Co., will pay 3.38 Singapore dollars a share for the warehousing firm, GLP said in a statement Friday.
The group was chosen by GLP's board over several other potential investors including Warburg Pincus LLC and Blackstone Group LP, which both sought to bid for GLP.
The offer was more than 25% higher than GLP's last traded price of S$2.70 a share before the stock was halted Thursday morning. GLP shares have risen sharply since the beginning of the year, when its largest shareholder, Singapore sovereign-wealth fund GIC Pte Ltd., said it asked for a strategic review of GLP's options.
GIC, which owns 37% of GLP, has committed to vote in favor of the deal, according to stock-exchange filings, though it has wiggle room to accept a competing offer if one is made.
To proceed, the deal must receive approvals both from shareholders and the Singapore courts, which GLP said it would request.
In a statement, Global Logistic Properties Chairman Seek Ngee Huat said the company chose the Chinese-backed consortium because it believed the offer was "compelling and value-enhancing for all shareholders."
Chinese regulators in recent months have carefully eyed big purchases abroad and sought to limit capital leaving the country. However, the funding for the deal will come from outside China, which helped enhance the offer, said a person familiar with the matter.
The deal will include debt financing of just less than US$5 billion, people familiar with the matter said. Citigroup Inc. and Goldman Sachs Group Inc. are arranging the debt financing. Citigroup, Morgan Stanley and Goldman Sachs advised the consortium on the deal.
GLP, whose customers include Amazon.com Inc. and DHL Worldwide Express Inc., is a major player in the booming business of storing and moving goods from suppliers to consumers. It manages nearly US$40 billion in logistics assets--a bit more than half the amount that No. 1 warehouse owner Prologis Inc. of the U.S. does. GLP says it is the biggest owner of warehouses in many of the world's most important markets, including China, Japan and Brazil. It is the second largest in the U.S. after Prologis.
Julie Steinberg in Hong Kong contributed to this article.
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(END) Dow Jones Newswires
July 14, 2017 05:59 ET (09:59 GMT)