SF Holding Co (順豐控股), one of the largest Chinese logistics firms, is seeking to acquire control of Malaysian billionaire Robert Kuok’s (郭鶴年) Kerry Logistics Network Ltd (嘉里物流) in a HK$17.6 billion (US$2.3 billion) deal for its global expansion.
The Chinese courier plans to buy a 51.8 percent stake in Hong Kong-listed Kerry Logistics at HK$18.8 per share, according to a joint statement to the Hong Kong Stock Exchange released yesterday.
Kerry Logistics also plans to sell some warehouse assets for HK$13.5 billion and its Taiwan business for NT$4.5 billion (US$158.5 million) to its parent company, the statement said.
Photo: Billy H.C. Kwok, Bloomberg
Kerry Logistics proposes a special dividend of HK$7.28 per share conditional on the completion of the warehouses sale.
Shareholders who accept SF Holding’s offer would receive HK$26.08 including the special dividend, representing an 11 percent premium to the last closing price.
Kuok, who is Malaysia’s richest person, controls Kerry Logistics through his family holding company Kerry Group (郭氏集團) and its Hong Kong-listed real estate arm Kerry Properties Ltd (嘉里建設).
SF Holding would offer cash for the Kerry Logistics stake and plans to keep the company listed in Hong Kong. After the transaction, Kerry Properties’ holding in the logistics firm would be cut to about 20 percent from 40 percent.
“The deal demonstrated the Kuok family’s vote of confidence to SF Holding and to myself,” SF Holding chairman Dick Wong (王衛) said in a news briefing. “While Kerry Group gave us the control of the company, we’ll still jointly manage Kerry Logistics together in the future.”
SF Holding shares jumped by their 10 percent limit on the Shenzhen Stock Exchange after trading resumed.
Kerry Logistics climbed as much as 10.5 percent to a record high in Hong Kong, while Kerry Properties gained as much as 19 percent in its biggest intraday advance since May 2009.
The deal would help SF Holding boost its distribution network and supply-chain services as it gains a footprint across Asia.
Kerry Logistics would become the Chinese courier’s primary vehicle for international expansion.
SF Holding’s shares have more than doubled over the past 12 months, helping the company surpass FedEx Corp in value and giving it a market capitalization of about US$83 billion.
The Chinese group owns courier service SF Express, which has benefited from the rise in online shopping in China fueled by companies like Alibaba Group Holding Ltd (阿里巴巴) and JD.com Inc (京東).
In 2019, SF Holding completed the acquisition of Deutsche Post DHL Group’s supply chain assets in China for 5.5 billion yuan (US$854 million at the current exchange rate).
JPMorgan Chase & Co is the financial adviser to SF Holding, while the Kerry Group companies have Citigroup Inc as their financial adviser.
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