Goodman Commits To J-rep Business In Response To Customer And Investor Demand

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18th October 2010, 09:27pm - Views: 884






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MEDIA RELEASE PR41785


Goodman Commits to J-REP Business in Response to Customer and Investor Demand


SYDNEY, Oct. 18 /PRNewswire-Asia-AsiaNet/ --


     Macquarie Goodman Japan Pte Ltd (MGJ), a 50/50 joint venture between Goodman Group (Goodman)

and Macquarie Group (Macquarie), lodged a proposal with Japanese regulatory authorities on Friday to

strengthen its Japanese logistics offering, conducted via J-REP Co., Limited (J-REP).


    Transaction overview: 


    + A tender offer bid made to all shareholders and option holders,

      providing liquidity to those shareholders and potentially increasing

      Macquarie and Goodman's interest in J-REP;


    + Provision of development funding to J-REP and granting of share

      acquisition rights in J-REP; 


    + Establishment of the Japan Logistics Development Vehicle (JLDV), 

      seeded with a pre-committed development to leading Japanese third

      party logistics operator, Nippon Express; and


    + An intention to rebrand J-REP to Goodman.


    Tender offer 


    In 2007, MGJ purchased a controlling interest in J-REP and as at the date of this announcement holds

51.7% of the total outstanding securities. 

 

    The tender offer, lodged with Japanese regulatory authorities provides an opportunity for shareholders to

obtain liquidity in respect of their investment in J-REP, with MGJ's intention to make J-REP a wholly owned

subsidiary of MGJ.  


    The tender offer price of 35,000 JPY per share compares to J-REP's closing price on 15 October 2010 of

24,650 JPY.  


    The tender offer opened on 18 October 2010 and will be available for acceptance by shareholders until 1

December 2010.   

 

    J-REP's board of directors (excluding Goodman and Macquarie related directors) have voted unanimously

to recommend that J-REP's shareholders accept the tender offer.  


    Funding


    MGJ will provide J-REP with a new 3.5 billion JPY ($A43.5 million) two year revolving loan facility, primarily

to be used by J-REP to co-invest in development projects alongside Goodman, Macquarie and, potentially,

other third party investors who will invest via JLDV as outlined below.  


    As part of the loan facility, J-REP will grant 100,000 share acquisition rights with an exercise price of 35,000

JPY to other Goodman and Macquarie entities.  


    Japan Logistics Development Vehicle (JLDV)


    Additionally, a new Japanese focused development vehicle will be established with an initial equity

commitment totalling 4 billion JPY ($A49.7 million) provided equally from Goodman and Macquarie. 

Furthermore, J-REP may co-invest up to 20% in the assets to be acquired pursuant to these arrangements,

and be responsible for the sourcing of new development opportunities and the provision of development

management and asset management services.  


    The JLDV will undertake its development activities primarily on a pre-committed basis with a focus on the

Tokyo and Osaka markets. The initial seed development sourced by J-REP for the vehicle is a 33,000 sqm

warehouse facility for Nippon Express in Tokyo.  The estimated date of practical completion of the

development is December 2011. Nippon Express has entered into an agreement for lease for a fixed term of

10 years.    


    Rebranding


    At the appropriate time, it is proposed to rebrand J-REP to Goodman Japan.  


    Goodman Group's CEO, Greg Goodman commented that "the above initiatives provide a catalyst for

Goodman to fully expand its global network into Japan and provides us with the platform to capitalise on the

opportunities that exist for the Japanese market as a result of the burgeoning growth in China and reduced

competition locally.


    "Today's announcement delivers a clear operating strategy for the business to move forward with, and

provides our customers and investors with a truly integrated property solution in Asia Pacific."   




    About J-REP:  visit http://www.jrep.co.jp


    Note: Currency conversions are calculated at the rate of JPY/AUD 80.48.


    For further information, please contact Goodman:  

    

     Greg Goodman   

     Group Chief Executive Officer  

     Tel: +61-2-9230-7400     


SOURCE:  Goodman Group


   

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