Singapore state investment firm Temasek Holdings has acquired a 21.7% stake in the LF Logistics, the logistic firm owned by Hong Kong parent company Li & Fung.
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In a statement released by L& Fung, the deal was signed for a cash consideration of $300 million, valuing the company at some $1.4 billion on a post-money equity valuation basis. Li & Fung will remain a controlling shareholder, holding 78.3% on completion of the deal.
LF Logistics is a supply chain partner for companies looking to expand in Asia and boasts networks in Greater China, ASEAN, Japan, Korea, the Middle East, and India.
Li & Fung first announced plans to list its LF Logistics in August 2019.
With this latest deal, the funds will be used to facilitate “future capital expenditures, repay existing bank facilities and accelerate business growth initiatives at LF Logistics,” according to a Li & Fung statement.
“The board believes the Investment would allow the company to unlock the value of LF Logistics and accelerate its business growth, as well as further enhance the capital structure and the financial flexibility of the group,” Li & Fung added.
Founded in 1906, Li & Fung operates in consumer goods design, development, sourcing and logistics. It specializes in managing supply chains of high-volume goods for leading retailers and brands worldwide.
Incorporated in 1974, Temasek is a global investment company headquartered in Singapore and has a network of international offices. Temasek owns a S$308 billion portfolio, with significant exposure to Singapore and the rest of Asia.
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In 2019, Temasek entered into a 50:50 joint venture with Swiss transport and logistics firm Kuehne Nagel International, for the creation of an entity that invests in start-up logistics technology companies.