CJ Logistics is trying to offload its Chinese unit CJ Rokin, a move which will also offer STIC Investments an opportunity to possibly end its five-year investment in the affiliate of South Korean food and entertainment conglomerate CJ Group.
Morgan Stanley has been hired by CJ Logistics to handle the sale process, industry sources said on October 8, with CJ Rokin expected to fetch more than $1 billion (approximately 1.2 trillion won). The unit has an extensive network connecting 1500 cities across China, including 48 logistic centers with a combined warehouse space of 1 million square meters.
Numerous investors, including global private equity firms and Chinese logistics companies, are reportedly showing interest in buying the company, with close attention being paid to the asking price.
CJ Rokin was founded in October 2015 when CJ Logistics and STIC Investments jointly acquired a 71.4 percent stake in Rokin, then the largest refrigerated and frozen transport firm in China, for 455 billion won. A special purpose company (SPC) called CJKX Rokin Holdings Limited carried out the takeover, which was financed through a corporate partnership fund (COPA fund) formed by CJ Group, National Pension Service (NPS) and STIC Investments.
CJ Logistics has a 53.1 percent stake in the SPC and STIC Investments has the remaining share of just under 47 percent. STIC Investments will be able to exit the company by selling its holding if the company is sold.
The COPA fund, created in March 2014 with 1 trillion won, attracted about 500 billion won from NPS. STIC Investments acted as a general partner. It now includes CJ Rokin, Brazilian soy protein maker Sementes Selecta and Vietnamese logistics firm Gemadept.
CJ Group will be able to secure cash to shore up its finances if CJ Rokin attracts a good price. (Reporting by Hye-ran Kim)