AusRAIL, Market Sectors

Kaplan to form Singapore joint venture focused on China

<p>Kaplan Funds Management (KFM) planned to spend $20m forming a logistics joint venture with Singapore-listed Freight Links Express Holdings with a view to investing in China and later India, KFM managing director Sam Kaplan told <em>Lloyd’s List DCN</em> today (Wednesday, September 26). </p> <p>Mr Kaplan said it was not KFM’s initial intention to seek a place on the Freight Links board but left that option open.</p> <p>KFM would use two investment funds &#8211 KFM Diversified Infrastructure and Logistics Fund (KIL) and private equity fund Kaplan Equity Ltd (KEL) &#8211 to buy 8.8% of Freight Links.</p> <p>KIL and KEL would each be issued 90m shares in Freight Links at S$0.10 per share under a private placement. </p> <p>KIL and KEL, through the joint venture, have also agreed to acquire an additional 90m warrants in Freight Links exercisable at S$0.05 at any time up to March 2009. </p> <p>If exercised, KIL and KEL would then own about 9.4% of the company on a fully diluted basis. </p> <p>Mr Kaplan revealed that former Patrick managing director and now fund advisory committee chairman Chris Corrigan and his team had had been a driving force in the strategy that led to the Freight Links deal.</p> <p>&#8220He’s putting a lot of strategic thinking into some of the things we are thinking of in China,&#8221 Mr Kaplan said.</p> <p>He denied Kaplan was following Toll’s strategy in entering the Asian market, saying Kaplan was investing in expertise, building on Freight Links’s dangerous goods logistics skills </p> <p>&#8220It is something that we’ve had a focus on for a while,&#8221 Mr Kaplan said.</p> <p>&#8220Look, there is an element of the integrated model Toll was talking about but I think our emphasis was more in terms of the talent base of our people and what they can add to investments on the ground in China as opposed to the grand strategy of being a worldwide player or and Asia player.&#8221</p> <p>Established in 1981, Freight Links provides a comprehensive range of logistics activities, including international freight forwarding, chemical and dangerous goods logistics, warehousing, property management, and record management. Freight Links has offices in Singapore, Malaysia, Thailand, Hong Kong, Australia, China and Dubai. </p> <p>Freight Links had already made a number of successful investments in China, and the joint venture would aim to leverage Freight Links’s network and understanding of the Chinese logistics market and KFM’s expertise in integrated logistics solutions with a focus on inland intermodal terminals and port logistics, KFM said. </p> <p>&#8220We have known the KFM team for some time and have been impressed by their knowledge and expertise across the entire logistics chain,&#8221 Freight Links chief executive Eric Khua said. </p> <p>&#8220We believe they are the right partner to help us undertake the range of attractive opportunities in China that we have already identified, and we welcome them as a major investor in the company.&#8221 </p> <br />