Global Logistic Properties Ltd - Reviewing strategic options
- Strategic review of options.
- Request from largest shareholder.
- No definite transaction entered.
Undertaking independent strategic review of options
- GLP announced that it is undertaking an independent strategic review of options to enhance shareholder value, after it has received a request from its largest shareholder, GIC Real Estate Private Ltd, which holds a 37% stake in the GLP.
- The group has appointed JP Morgan as a financial advisor to assist on the strategic review and has also set up a special committee, comprising four independent directors, to oversee the strategic review.
Making preliminary approaches to various parties
- We understand that the group, through JP Morgan, is in the process of making preliminary approaches to various parties to evaluate the viability of options for its business.
- Management emphasized that no definite transaction has been entered into with any party.
- Overall, we see this as a positive development that underscores the fact that the GLP's share price has been persistently undervalued but caution against speculating on a near-term sale of the company, which is uncertain.
Significant long term fundamental value in GLP shares
- We continue to see significant long term fundamental value in the group's shares at current prices, given its business portfolio and leading positions in its key markets.
- We believe the outlook for advanced logistic facilities remains firm with the growth of e-commerce globally, particularly in the group's major market China where online shopping is undergoing vibrant growth. The group manages over US$12b of assets in China and enjoys significant operating leverage with its scale and network of key clients.
- Maintain our BUY rating with a fair value estimate of S$2.37.