Subject: GIC (Singapore SWF) Said to Start Talks With Investors for $3 Billion Unit IPO
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Date: Thu, 9 Sep 2010 11:31:33 -0400

GIC Said to Start Talks With Investors for $3 Billion Unit IPO
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By Joyce Koh

Sept. 9 (Bloomberg) -- The Government of Singapore Investment  
Corp.started talks with potential corporate investors for the $3  
billion initial public offering of its logistics unit, two people with  
knowledge of the matter said.

GIC has identified about 50 so-called cornerstone investors including  
real estate and hedge funds, and some international wealthy  
individuals, one of the people said, declining to be identified as  
discussions are private. The warehouse unit, calledGlobal Logistic  
Properties, started pre-marketing the sale to analysts in Singapore  
and Hong Kong today and is expected to start trading in Singapore Oct.  
15, the people said.

The IPO may raise as much as $3 billion, the people said, making it  
the city-state’s biggest first-time sale since Singapore  
Telecommunications Ltd.’s initial offering in 1993. GIC, manager of  
more than $100 billion of Singapore’s foreign exchange reserves,  
bought the assets from ProLogis, the world’s largest owner of  
warehouses, for $1.3 billion in December 2008.

“Increasing the comfort level of investors with strong cornerstones is  
key, particularly when the assets are all located outside of the  
listing country,” saidJanice Ding, a Singapore-based analyst at CIMB  
Research Pte.

Cornerstone investors are guaranteed shares in IPOs in exchange for a  
pledge to hold the stock for a certain period of time. Companies use  
the cachet of the investors, who may be institutions, companies or  
billionaires, to drum up interest in their offerings among other  
potential buyers.

Jennifer Lewis, a spokeswoman for GIC, didn’t immediately return calls  
seeking comment.

Policy Risks

Global Logistic operates in 25 markets in Asia outside Singapore,  
according to its website. In China, the company manages 51 logistics  
parks in 18 cities, totaling 4.4 million square meters (47 million  
square feet) at the end of June. It runs 69 logistics facilities in  
seven cities in Japan.

“Investors are likely to be more demanding on pricing as the Japanese  
logistics market is highly competitive and the Chinese industrial  
market carries relatively high policy risks,” said Ding.

GIC plans to sell 95 percent of the shares to institutional investors,  
with the remainder allocated to retail investors in Singapore, one of  
the people said.JPMorgan Chase & Co. and Citigroup Inc. are lead  
managers of the IPO, withUBS AG, China International Capital Corp. and  
DBS Group Holdings Ltd. among other arrangers.

To contact the reporter on this story: Joyce Koh in Singapore [email-masked]

Last Updated: September 9, 2010 00:25 EDT