18 November 2012

Global Logistic Properties expands its global network to Brazil

- Establishes the largest logistics platform in Brazil 
- Forms two JV with CPPIB, CIC and GIC 
- Total initial consideration of US$1.45 billion 

Singapore - 14 November 2012 – Global Logistic Properties Limited (GLP) today announces the signing of an agreement to expand its global network to Brazil. This transaction establishes the largest logistics platform in Brazil with a strong development pipeline for further growth. This is consistent with GLP’s strategy to focus on the best markets and grow its fund management platform. 

GLP will form two joint ventures with Canada Pension Plan Investment Board (CPPIB), China Investment Corporation (CIC) and Government of Singapore Investment Corporation (GIC) to acquire two portfolios of logistics facilities from Prosperitas for a total initial consideration of BRL2.9 billion (US$1.45 billion). GLP’s initial equity requirement is BRL668 million (US$334 million). 

In the first joint venture (Stabilized JV), GLP will partner with CPPIB, CIC and GIC to acquire a portfolio of 34 stabilized assets and one development project. GLP and CIC will each own 34.2% of the Stabilized JV, with GIC holding 20.0% and CPPIB 11.6%. 

In the second joint venture (Development JV), GLP will partner with CPPIB and GIC to acquire a portfolio of five development projects. GLP will own 41.3% of the Development JV, with CPPIB owning 39.6% and GIC 19.1%. 

88% of the two joint ventures’ combined assets are located in the primary logistics markets of São Paulo and Rio de Janeiro, which together generate greater than 40% of Brazil’s GDP. 

GLP will act as the asset manager of the acquired properties. The existing on-the-ground 40-person team, with considerable local experience, will continue to be in charge of day-to-day operations, as well as building GLP’s platform in Brazil. 

Jeffrey Schwartz, Deputy Chairman of GLP said, “This transaction represents a unique opportunity for GLP, giving us a market-leading position in Brazil, as well as a strong platform for future growth in the country. It is consistent with both our strategy to focus on only the best markets globally and in growing our fund management platform. This exciting transaction builds on our successful and market-leading businesses in China and Japan and we are confident that it will create long-term value for our shareholders.” 

The joint venture agreements and purchase and sale agreement were signed on 14th November 2012 by GLP’s Brazilian subsidiaries. For its pro-rata share of the equity, GLP will initially contribute BRL386 million (US$193 million) to the Stabilized JV and BRL282 million (US$141 million) to the Development JV. 

The Stabilized Joint Venture will assume BRL1.1 billion (US$534 million) of attractive onshore debt with a bullet-like repayment schedule. It has lower interest rates compared to alternative market financing options and has a weighted average maturity of around 8 years. GLP intends to fund part or all of its initial equity commitment of US$334 million with a private equity placement. 

Global Logistic Properties (GLP) is one of the world's largest providers of modern logistics facilities, with a market-leading presence in China, Japan and Brazil. It owns, manages and leases out 505 completed properties in 205 logistics parks spread across 60 cities in China, Japan and Brazil, forming an efficient logistics network with properties strategically located in key logistics hubs, industrial zones and urban distribution centres. 

Source: GLP