GIC's Logistics Unit Set to Raise Up to $3 Billion in IPO

(September 9, 2010) — The Government of Singapore Investment Corp., the world’s fourth-biggest sovereign fund with a portfolio valued at more than $185 billion, is set to list some of its logistics assets October 15 via an initial public offering, with a goal to raise up to $3 billion.

Global Logistical Properties (GLP), which owns industrial and logistic properties in China and Japan, will be the first listing of a majority-owned firm by the GIC. The firm is one of Asia’s biggest operators of logistics parks, managing 53 logistics parks in 18 major cities, according to its website. Singapore’s SWF aims to raise the money in what could be the city-state’s biggest IPO since Singapore Telecommunications Ltd. listed in 1993 and raised $2.98 billion. If successful, the IPO would also dwarf CapitaMalls Asia’s $2.02 billion IPO launched last year.

GLP’s listing will be among several large listings expected in Asia in the next few weeks. In the coming months, a S$1 billion IPO is planned by Mapletree Industrial Real Estate Investment Trust, a unit associated with state investment firm Temasek Holdings Pte. Ltd, while China-based New Century Shipbuilding is also exploring the possibility of a S$700 million Singapore IPO this year, the Wall Street Journal reported.

The fund plans to sell 95% of the shares to institutional investors, with the remainder allocated to retail investors in Singapore, according to Bloomberg. JPMorgan Chase & Co. and Citigroup Inc. are lead managers of the IPO, with UBS AG, China International Capital Corp. and DBS Group Holdings Ltd. among other arrangers.

Separately, with aims to expand oversees partnerships and investments, South Korea plans to funnel more than $5 billion into the $35 billion Korean Investment Corp (KIC) next year.”Partnering with big state funds will help us grow more quickly,” a government official told Reuters late on Wednesday, adding that the government planned to increase investments in alternative assets such as real estate and hedge funds by $1.5 billion to 20% of its investment holdings.