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Competition watchdog seeks public feedback on ARA, Logos deal
THE Competition and Consumer Commission of Singapore (CCCS) has launched a public consultation on a strategic deal between fund manager Logos Group and ARA Logistics, a unit of ARA Asset Management.
In December, ARA announced that it plans to transfer its entire holdings in Cache Logistics Trust (CLT) and ARA Trust Management (Cache) to Logos. ARA Trust Management (Cache) is the manager of Mainboard-listed CLT. Upon completion, ARA will retain control of the manager through Logos.
CCCS received an application from ARA Logistics on Jan 6 for the authority to assess if the transaction would breach competition laws. Both companies are involved in industrial real estate space for rental, specifically warehouse space, as well as property funds that invest in industrial real estate.
But ARA Logistics said that the deal will not be anti-competitive, because of the presence of large competitors, including industrial Reits (Real Estate Investment Trusts), new entrants who supply industrial real estate space for rental, as well as other fund managers.
ARA Logistics further said there are no "significant barriers to entry and expansion" for the industrial real estate rental segment, given the Singapore government's initiative to offer smaller industrial plots with shorter tenures.
There is also "high countervailing buyer power" by sophisticated tenants such as large MNCs and third-party logistics providers, alongside institutional investors for fund management services, ARA Logistics said. Moreover, the transaction produces only a low increase in market share, it added.
CCCS is inviting public feedback on the transaction via its website till Jan 30.
CLT shares closed at S$0.735 on Thursday, up 0.69 per cent.