China to build logistics platform in Brazil

Want China Times, Kang Chang-jung and Staff Reporter 2012-11-19

Brazil's pavilion at the China Import and Export Fair in Guangzhou, Oct. 19.
(File photo/Xinhua)

The China Investment Corp, a sovereign wealth fund responsible for managing China's foreign exchange reserves, has formed joint ventures with large institutional investors from Singapore and Canada to purchase Brazilian assets worth more than US$1.4 billion in a bid to build the largest logistics platform in the booming South American country, our sister newspaper the Commercial Times reports.

CIC is teaming up with Singaporean warehouse operator Global Logistic Properties, the Canada Pension Plan Investment Board and Government of Singapore Investment Corp to form two joint-investment companies to purchase 40 properties from the Brazilian Prosperitas Logistic, which are worth around US$1.45 billion. CIC is expected to own a 34.2% share of the joint project.

About 88% of assets of the new two joint-investment companies will be located in the Brazilian cities Sao Paulo and Rio de Janeiro.

The deal follows CIC and GLP's joint purchase of Japanese logistics assets for US$1.6 billion at the end of last year. GLP is the logistics department under GIC and the world's largest warehouse operator, run dozens of logistics sites in China.

CIC has showed great interest in Brazil, attracted by strong market demand. In early Oct. 2010 market rumors said CIC contacted Brazil's finance ministry to discuss investing in Brazilian industry and agriculture. In Dec. 2011, CIC teamed up with international funds including GIC to purchase the new shares of BTG Pactual, the independent Brazilian investment bank, worth around US$ 1.8 billion. BTG currently has sites around Brazil, the US, Britain and Hong Kong with about 1,100 employees.