Narrative
Full Description
Project narrative
In June 2017, Chinese state-owned sovereign wealth fund China Investment Corporation (CIC) entered into a €12.25 billion EUR ($14.34 billion USD) agreement with The Blackstone Group L.P. to buyout European warehouse and logistics firm Logicor. Then, on November 15, 2017, a syndicate of lenders — including the Luxembourg Branch of the Bank of China Limited (BOC) and China Construction Bank (Europe) S.A. (CCB Europe) — entered into a €6.8 billion EUR-equivalent ($7.96 billion USD) syndicated loan syndicated facility agreement with Eurocor II S.à r.l. — a Luxembourg-incorporated special purpose vehicle (SPV) and a wholly-owned subsidiary of Majority Midco S.à r.l., a Luxembourg-incorporated SPV, which is majority-owned by Eurologi II S.à r.l, a Luxembourg-incorporated SPV wholly-owned by CIC and certain co-investors — and Eurocor III S.à r.l — a Luxembourg-incorporated SPV and a wholly-owned subsidiary of Minority Midco S.à r.l., a Luxembourg-incorporated SPV, which is majority-owned by Eurologi III S.à r.l., a Luxembourg-incorporated SPV majority-owned by vehicles of Blackstone Holdings IV and Blackstone Property Partners Europe and minority-owned by CIC and certain co-investors — to finance CIC’s acquisition a majority stake in European warehouse firm Logicor from Blackstone. This loan was divided into three tranches: a €4,530,000,000 EUR tranche, a £1,871,000,000 GBP tranche, and a kr1,298,000,000 SEK tranche. This loan was secured by (i.e. collateralized against) certain share and shareholder loan security and all assets security. BOC Luxembourg and CCP Europe together contributed €3.8 billion EUR ($4.46 billion USD) of the €6.8 billion EUR syndicate, with the remaining €3 billion EUR ($3.52 billion USD) syndicated to other banks. Record ID#104780 captures BOC Luxembourg Branch's contribution. Record ID#104781 captures CCB Europe's contribution. BOC Luxembourg Branch and CCB Europe served as mandated lead arrangers. BOC Luxembourg served as agent, documentation agent, and security agent. CIC tapped BOC and CCB Europe to arrange and jointly underwrite the loan in July 2017. At the time of the acquisition, Logicor owned over 600 logistics facilities in Europe across 17 countries focused in seven major regions: the United Kingdom, Germany, France, Southern Europe, the Nordic countries, Central and Eastern Europe, and Benelux. It was the largest logistics asset owner with 13 million square meters (147 million square feet) of logistics space. Logicor assets were located in, among other countries, the Czech Republic, Hungary, Poland, Romania, Russia, and Slovakia. CIC was the leading investor, with several Chinese equity partners. The acquisition was completed on November 29, 2017. The €6.8 billion EUR was the largest syndicated loan in the Asia-Pacific region in 2017. This was CIC's debt in the syndicated loan market and the largest loan for an Asian sovereign wealth fund. The Logicor acquisition was CIC’s largest direct investment in asset value to date. This was at the time the largest deal for a Chinese company to acquire a logistics asset in Europe. CIC cited the acquisition as advancing the Belt and Road Initiative (BRI) due to the number of assets owned by Logicor in BRI countries. On January 15, 2020, the borrower prepaid the facility in its entirety.
Staff comments
1. The Chinese project title is 中投公司收购黑石集团物流资产LOGICOR. 2. The individual contributions of BOC and CCB Europe to their collective €3.8 billion EUR contribution to this syndicated loan are unknown. For the time being, AidData has estimated the contribution of BOC and CCB Europe by assuming that each lender contributed an equal amount (€1,900,000,000 EUR) to that amount. 3. China Investment Corporation (CIC) is a state-owned sovereign wealth fund. It wholly owned by the Chinese Government and has its own corporate entity status. The purpose of the CIC is to maximize returns at acceptable risk tolerance and improve the corporate governance of key state-owned financial institutions. It was established in 2007 with about $200 billion of assets under management, a number that grew to $1.2 trillion in 2021.