Withdrawal of Credit Rating Coverage by S&P
Singapore, 2 November 2023 – GLP Pte. Ltd. (“GLP” and with its subsidiaries the “Group”) confirms the withdrawal of credit rating coverage by Standard & Poor’s (“S&P”).
While GLP respects S&P’s independent views, GLP has taken this action due to the irreconcilable mismatch between S&P’s credit rating methodology and GLP’s revenue and business model which has evolved over the years. The current rating methodology used by S&P under the REIT regime remains incompatible with our monetization model. As a consequence, the recurring nature of gains generated from our capital recycling are not given recognition in their ratings methodology, which results in an incomplete assessment of GLP’s revenue profile and credit strength.
At inception, GLP was a pure play owner and operator of logistics real estate, aligned to traditional REIT rating criteria. Since then, GLP has grown significantly to over USD 50 billion of assets on its balance sheet as at 1H 2023 and now operates a more diversified global business model with assets and revenues from high demand new economy sectors.
As a core part of its long-standing business model over 14 years, GLP develops, incubates and monetizes high quality new assets and businesses within its highly sought after core sectors of logistics real estate, data centers and renewable energy and monetizing them through investment funds raised by GLP Capital Partners or to third parties. These proceeds offer stable and recurring contributions to GLP’s EBITDA and underpin the overall resilience of the company's earnings.
GLP has consistently generated USD 5 billion in annual net monetization proceeds since its 2018 privatization. The Group is targeting USD 10 billion of asset monetisations as publicly announced on October 9th, 2023, which will provide ample liquidity to address all the near-term obligations (See https://www.glp.com/global/article/glp-forecasts-strong-monetizations-strong-fundamentals-and-high-demand-continues-quality).
GLP’s sectors and assets are well-positioned, benefiting from strong fundamentals and secular tailwinds which include strong e-commerce growth, the global shift towards decarbonization and energy transition, and rising demand for data storage due to increased enterprise adoption of cloud and artificial intelligence. Logistics remains the sector of choice for real asset investors and will enable the Group to accelerate its programmatic asset monetization strategy and recycling of capital into deleveraging. GLP expects to further reduce its net leverage from the current 25 percent level.
GLP remains committed to transparency and will continue to evaluate its rating strategy, including exploring separate ratings for individual business lines, where appropriate, to facilitate investors with their analysis and formation of an accurate view on its business.
GLP is a leading global business builder, owner, developer and operator of logistics real estate, data centers, renewable energy, and related technologies. GLP’s deep expertise and operational insights allow it to build and scale high-quality businesses and create value for its customers. GLP owns and operates assets and businesses in 17 countries across Asia, Europe and the Americas. GLP Capital Partners, a global alternative asset manager, is the exclusive investment and asset manager of GLP. To learn more about GLP, visit www.glp.com/global.
Debt Investor Contact: