Warburg Pincus said to be forming consortium to bid for Singpore’s GLP

From Warbug Pincus homepage

Warburg Pincus is forming a consortium to bid for Global Logistic Properties Ltd., the Singapore-based warehouse operator, according to people with knowledge of the matter.

Warburg Pincus has been speaking with banks and potential bidding partners about an offer for the industrial property owner, which has a market value of about $8.2 billion, the people said. GLP, which has assets in China, Japan, the U.S. and Brazil, has asked for first-round offers by early February, people with knowledge of the matter said previously.

The company said last month it would conduct a strategic review of options to improve shareholder value following a request from its biggest investor, Singapore sovereign wealth fund GIC Pte. A consortium including Chinese buyout firm Hopu Investment Management has also held talks about making an offer for GLP, people with knowledge of the matter said in November.

Also Read: Singapore: Global Logistic Properties seeks potential bidders for $7.8b co

Purchasing GLP would help Warburg Pincus take advantage of a boom in demand for warehouse space from e-commerce companies like Alibaba Group Holding Ltd. and JD.com Inc. Any transaction would add to at least $8.4 billion of deals that the private equity firm has announced in Asia over the past three years, data compiled by Bloomberg show.

Management Support

Bidder groups see the support of existing company management as key to the success of their offers, one of the people said. Representatives for Warburg Pincus and GLP declined to comment.

Shares of GLP have gained 14 percent this year, outpacing the 4.2 percent rise in Singapore’s benchmark Straits Times Index. The company’s clients include Adidas AG, French retailer Carrefour SA and luxury-goods giant LVMH Moet Hennessy Louis Vuitton SE, its website shows.

Also Read: Singapore property owner GLP gets takeover offer from China fund CIC Group

Warburg Pincus has previously invested in e-Shang Redwood Group, which owns a portfolio of logistics properties in China, Japan and South Korea. The U.S. private equity firm is also leading a buyout of  ARA Asset Management Ltd. that was announced in November, valuing the Singapore real estate investment firm at S$1.78 billion ($1.2 billion).

In November 2015, Warburg Pincus announced it had completed fundraising for a $12 billion global private equity fund. The firm opened a Singapore office last year led by Managing Director Jeffrey Perlman to seek growth investment opportunities across Southeast Asia.

Warburg Pincus said at the time it has invested in more than 140 Asian companies, including Chinese package delivery firm ZTO Express (Cayman) Inc. and Indian developer Piramal Realty. In August, Warburg Pincus and KKR & Co. led a $550 million round of funding for Indonesian startup Go-Jek, which provides motorcycle rides on demand.