Hong Kong sourcing company Li & Fung has sold 21.7 per cent of its logistics business LF Logistics to Singapore-based investor Temasek for US$300 million, DealStreetAsia reported.

LF Logistics positions itself as a partner for supply chain companies looking to expand in Asia, spanning Greater China, Southeast Asia, Japan, Korea, the Middle East, and India.

Li & Fung said that Temasek’s investment values the company at approximately US$1.4 billion on a post-money equity valuation basis. The deal will see Li & Fung remain a controlling shareholder of LF Logistics.

However, Temasek’s investment put a halt in Li & Fung’s plan to go IPO with LF logistics in the first half of 2019, as it announced back in August last year.

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The fresh funding will be directed towards funding future capital expenditures, repaying existing bank facilities, and accelerating business growth initiatives at LF Logistics, the company said.

“LF Logistics now has operations in all of Asia’s fastest growing cities that makes us well positioned to capitalise on rising middle-class consumption. Our early investment in e-logistics allows us to enjoy first-mover advantage,” said Li & Fung group president Joseph Phi.

Just last year, Temasek and Switzerland-based Kuehne Nagel International AG, a global logistics groups, joined forces in establishing a 50:50 joint venture entity that will invest in early-stage logistics technology companies.

Kuehne Nagel International AG provides IT-based logistics solutions in sea freight and airfreight forwarding, contract logistics, and overland businesses.