SINGAPORE/HONG KONG (Reuters) - A leading Chinese private equity consortium backed by senior executives from Global Logistic Properties (GLP) (GLPL.SI) won a bid to acquire GLP for S$16 billion ($11.6 billion), marking Asia's largest private equity buyout in a buoyant sector.
GLP, which is Asia's biggest warehouse operator and boasts a $41 billion portfolio of assets spread across China, Japan, Brazil and the United States, is benefiting from rising demand logistics facilities driven by a boom in e-commerce from clients such as Amazon.com Inc and JD.com Inc.
The winning bid of China's Hopu Investment Management, Hillhouse Capital Group, real estate developer Vanke Group and the financial service investment arm of Bank of China was backed by GLP CEO Ming Mei, which trumped an offer by a Warburg Pincus-led consortium - the only other short-listed bidder.
The group is offering S$3.38 in cash per share, representing an 81 percent premium over its 12-month volume weighted average price and a 25 percent premium over its last full trading day before the announcement.
Surprisingly, the acquisition is not conditional on getting antitrust approvals or a green light from the Committee on Foreign Investment in the United States (CFIUS), among others, at a time when regulators are vetting takeovers more closely.
Singapore sovereign wealth fund GIC, which owns 37 percent of GLP and is its biggest shareholder, is supporting the transaction but is free to accept an unmatched superior offer.
"GIC played hard to get a decent offer," said a person with direct knowledge of the deal. "There's a good premium with very few strings attached."
Last year, GIC nudged GLP to start a strategic review of its business after its shares tumbled over a period of two years starting in 2015. GLP then hired JPMorgan as its financial adviser and Allen & Gledhill as its legal adviser to work on the review.
The seven-month auction for GLP was marred by complaints from some potential bidders about a lack of transparency and the perceived advantages of the Chinese consortium through their business ties.
GLP then formed a committee of independent directors and said it took measures to alleviate potential conflicts of interest. It said on Friday that it chose the Chinese consortium because it had more deal certainty and "limited conditionality", reducing "execution risk".
GLP shares soared 22 percent on Friday to a record high.
Before Friday's jump, the shares had surged nearly 50 percent since late last year when GIC requested the strategic review.
Investors including Carlyle Group LP, Canada Pension Plan Investment Board (CPPIB) and Warburg Pincus [WP.UL] have splashed more than $12 billion on the logistics sector in China since 2013, betting a surge in online shopping will spur demand for delivery and warehousing services.
Analysts said GLP, which earns the majority of its revenue from China, was especially well positioned to benefit from the e-commerce boom.