S.F. Holding, China’s largest listed courier provider, plans to raise up to HK$2.68 billion (US$345 million) through listing an offshore real estate investment trust (Reit) in Hong Kong.
SF Real Estate Investment Trust (SF Reit) will sell 520 million units in a range of HK$4.68 to HK$5.16 each. The company will start marketing the public offering from Wednesday, with the Reit units debuting on May 17.
“We are the first Reit focused on logistic assets in the Greater China market,” Hubert Chak, the CEO of SF Reit Asset Management, told a media briefing on Tuesday.
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Two cornerstone investors, state-owned China Orient Asset Management and a Canada-based investment fund, will subscribe to a combined US$50 million worth of Reit units.
A listing application for SF Reit was submitted to the bourse operator Hong Kong Exchanges & Clearing on April 23.
Shenzhen-listed S.F. Holding, which operates SF Express, is injecting three logistics centres worth HK$6.1 billion into the Reit to be listed in Hong Kong as part of a plan to free up cash from its assets, according to the document.
The sale price may be adjusted based on the final offer price.
One of them is its crown jewel, the Asia Logistics Hub-SF Centre in Tsing Yi, Hong Kong, valued at HK$5.29 billion. The 15-storey centre has 160,322 square metres of floor space comprising an automated parcels sorting facility and a distribution and warehousing facility.
The other two properties are a warehousing and distribution centre in Wuhu, Anhui province, worth about HK$264.7 million, and a distribution centre in Foshan, Guangdong province, estimated at HK$549.2 million, according to the filing.
They had a net asset value of HK$2.24 billion as of March 31 and generated a combined unaudited profit of HK$32.8 million on HK$77.6 million of revenue in the first quarter this year. Audited net profit in 2020 was HK$26.9 million on HK$279 million of revenue.
S.F. Holding expects to book a one-off gain of not less than HK$800 million from the spin-off exercise. After the listing of SF Reit, the three properties will be leased back to the S.F. Holding at market rents.
“We have seen stable rent revenue in the three properties ,” Chak said.
He added that with S.F. Holding’s backing, the company will see whether more logistics assets with high and stable rents can be injected into SF Reit in the future.
S.F. Holding, which operates SF Express and dubbed the FedEx of China, was founded by Wang Wei. Wang, 50, is China’s fifth richest billionaire with a net worth of US$26.6 billion, according to Forbes.
DBS is the sole listing agent for the deal. Joint book-runners on the deal include DBS, Credit Suisse and JP Morgan.
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