China Logistics Attracts Anbang, Sino-Ocean to $433 Million IPO

  • Carlyle-backed warehouse developer starts delayed share sale
  • Cornerstone investors account for more than half of offering

Warehouse developer China Logistics Property Holdings Co. attracted cornerstone investors including Anbang Life Insurance Co. to buy more than half of its Hong Kong initial public offering, which is seeking as much as $433 million.

The Shanghai-based company, which is backed by Carlyle Group LP, is offering 1.04 billion shares at HK$2.55 to HK$3.25 apiece, according to terms for the deal obtained by Bloomberg. The bottom end of the range represents a 59.5 percent discount to China Logistics Property’s estimated net asset value, the terms show.

China Logistics Property, which is also backed by RRJ Capital, is selling stock at a time when investors are jittery following Britain’s vote to leave the European Union last week. The company had delayed the start of the offering by two days due to volatile market conditions, a person familiar with the matter said earlier.

Anbang agreed to buy a 4.99 percent stake, or $55 million of stock at the mid-point of the marketed range, according to the terms. Chinese property developer Sino-Ocean Group Holding Ltd. committed to purchase a 9.99 percent holding in the company, the terms show. 

Cornerstone investors typically commit to hold their shares for six months in return for an early, guaranteed allocation. 

Online Shopping

Demand for warehouses and logistics services in China is rising as more consumers make purchases online. E-commerce operator JD.com Inc., package-delivery service SF Express Group Co., sourcing company Li & Fung Ltd. and smartphone maker Xiaomi Corp. are among China Logistics Property tenants, its website shows.

China Logistics Property’s revenue jumped 142 percent last year to 163.2 million yuan ($24.8 million) after it doubled the number of logistics parks in operation to 12, according to a March 30 pre-listing exchange filing

The company will use 89.5 percent of the offering proceeds to repay bank borrowings and redeem convertible securities held by Carlyle, while 5.4 percent will go toward developing new logistics park projects, according to the terms. China Logistics Property expects to price the share sale on July 8 Hong Kong time and start trading July 15, the terms show. 

Credit Suisse Group AG, Deutsche Bank AG, Bank of America Corp. and AMTD Group Co. are joint global coordinators of the offering.

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