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CIC said to bid for property owner

By Bloomberg | China Daily | Updated: 2016-11-04 07:06

Global Logistic Properties Ltd, the $6 billion owner of industrial property, has attracted takeover interest from an investor group that includes China's sovereign fund, sources with knowledge of the matter said.

China Investment Corp, Hopu Investment Management and Hillhouse Capital Management have held talks about making a joint offer for Singapore-based GLP, the sources added.

The suitors have reached out to potential partners to weigh their interest in joining the consortium, one source said.

GLP shares gained 8.7 percent to S$1.945 ($1.40) at the close on Wednesday in Singapore, after earlier jumping by an intraday record of 14.5 percent. Any deal would depend on the receptiveness of GLP's biggest shareholder, Singapore sovereign wealth fund GIC Pte, and there was no certainty the consortium would proceed with a bid, the sources said.

A transaction could rank among Asia's biggest-ever buyouts and would add to this year's record flow of Chinese acquisitions abroad, a binge that's been partially driven by anticipation of further declines in the yuan. GLP was trading on Tuesday at about 0.7 times the book value, making it a potentially attractive buyout target.

"GLP has been operating in China and the Chinese consortium knows the target very well, so it's a deal working in their favor," said Andrew Sullivan, a managing director at Haitong International Securities Group Ltd. "The Chinese investors are expecting the yuan to depreciate further, so they are watching very closely for any opportunity to acquire overseas assets."

Officials at the consortium members declined to comment or didn't immediately respond to requests for comment.

"The company wishes to advise that it is not in discussions with the above referenced investor group at this time," GLP said in an exchange statement on Wednesday in response to queries from the Singapore bourse. "The company remains committed to enhancing shareholder value and continues to review and assess potential opportunities."

GLP has been involved in at least $17.1 billion of acquisitions in the past three years, data showed, as the warehouse owner seeks to bulk up and take advantage of booming demand from customers like Alibaba Group Holding Ltd and JD.com Inc. The company's clients also include Adidas AG, Carrefour SA and LVMH Moet Hennessy Louis Vuitton SE, its website shows.

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