Mapletree Logistics Trust eyes acquiring Mapletree Wuxi Logistics Park

Acquisition is pegged at RMB116m.

According to OCBC, Mapletree Logistics Trust recently announced its intention to acquire Mapletree Wuxi Logistics Park (MWLP) in China from its Sponsor.

Here's more from OCBC:

The purchase consideration of RMB116m (~S$22.8m) was at a 2.5% discount to the average valuation of RMB119m by two independent valuers. Management guided that the acquisition is expected to be accretive at the DPU level, with an initial NPI yield of 8.0%.

This is higher than the implied yield of 6.0% for MLT’s existing China portfolio. According to MLT, MWLP is located in Wuxi New District where it enjoys good connectivity, hence making it suitable as a distribution centre for both domestic and overseas market.

At present, we understand that MWLP is leased to a strong tenant base of reputable companies including Wuxi Hi-tech, Kerry Logistics and Fiege International Freight Forwarder. The transaction is in line with our view that MLT will seek to expand its presence in overseas market such as China.

Upon completion, it will represent MLT’s third acquisition from its Sponsor’s development pipeline.

Separately, MLT also updated that the divestment of 30 Woodlands Loop in Singapore to Accenovate Engineering Pte Ltd will not proceed.

This was because the buyer’s application to purchase the property was not approved by JTC Corporation as it did not meet its evaluation criteria. MLT expressed disappointment with the unsuccessful sale but said it will continue to optimize the property’s yield while actively explore divestment or other value-enhancing opportunities.

We have earlier assumed the divestment to be completed by Feb 2013, as previously guided by MLT.