GLP hired JP Morgan just over a month ago to conduct a strategic review of its $8.6 billion business, and the investment bank appears to be earning its fees as two of the world’s largest private equity firms are now said to be bidding to acquire the Singapore-based warehouse developer.
Separate media reports this week have linked Blackstone and Warburg Pincus to rival bids for GLP, which is the biggest developer of warehouses in China, and is the second largest operator of logistics facilities in the United States.
GLP began the strategic review of its business in December at the request of GIC, which is the developer’s largest shareholder. The Singaporean sovereign wealth fund had pushed for the review process following a reported unsolicited offer for GLP from Chinese sovereign wealth fund CIC during November.
GLP confirmed last week that it has begun negotiating a possible sale of the company, without specifying potential buyers.
Warburg Pincus Putting Together New Consortium for Another SG Prize
Warburg Pincus is busy putting together a consortium to bid for GLP, according to an account in the Financial Times today. The US private equity firm has been discussing a buyout bid for the warehouse developer with possible partners and financial advisors, the newspaper reported, citing sources familiar with the discussions.
Warburg Pincus, which already has extensive real estate investments in Asia, revealed in November that it is playing a key role in a consortium pursuing a $1.3 billion bid to privatise Singapore-listed real estate investment firm ARA Asset Management. In that bid, Warburg Pincus has been working with ARA co-founder and CEO John Lim, as well as Singapore’s Straits Trading Company, Li Ka-shing’s Cheung Kong Property and China’s AVIC Trust.
The US private equity firm is also the lead investor in logistics developer e-Shang Redwood (ESR), which competes with GLP in mainland China. The joint venture warehouse builder announced earlier this month that it had closed $300 million in new financing as part of preparations for what is expected to be a multi-billion dollar IPO later this year.
Blackstone Joins the Bidding
Blackstone Group, which has its own joint venture mainland logistics platform with China Vanke, is also said to be busy putting together a group to bid for GLP, independent of Warburg Pincus. Also veteran China property investors, a report today in Bloomberg linked the New York-based private giant to the GLP bidding process, citing sources familiar with the matter.
In confirming the sale discussions last week, GLP noted that, “The company wishes to emphasize that no definitive transaction has been entered into by the company with any party and there is no assurance that any transaction will materialise from the strategic review.” However, the company is said to be expecting initial bids for its business by early next month.
CIC, which is already an investor in GLP’s China business, is said to be joined in its offer for the developer by mainland-based Hopu Investment Management and Hillhouse Capital Management.