Sovereign wealth fund-backed operator among potential suitors

DP World is believed to be one of the bidders circling for industrial developer Gazeley, which is on the market for £400m.

The company, which is owned by sovereign wealth fund Dubai World, is one of several parties, along with Legal & General, US REIT AMB and CB Richard Ellis Investors, thought to be lining up bids for the Wal-Mart-owned developer.

The identity of bidders interested in Gazeley proves the importance of equity-rich investors in the wake of the credit crunch.

If DP World succeeds, it would be its first UK corporate property deal.

It is thought that the sale process will take around eight weeks, and DP World will be pitting itself against other bidders for a place on a shortlist of up to six parties that Wal-Mart wishes to take forward.

All parties are yet to submit bids and the shortlist has not been finalised.

Bidders are thought to be attracted to Gazeley because of its UK expertise, its partnership with Wal-Mart, which is set to continue, and its global land bank.

However, several key names that were expected to bid, like Panattoni and Goodman, are not thought to be pursuing the opportunity.

It is believed that DP World senses an opportunity because of the drop in values of UK property. It is owned by state-backed Dubai World, and listed on the Dubai International Stock Exchange in November, when it raised almost $5bn (£2.5bn). It therefore has cash to spend in the current financial climate.

DP World already has substantial industrial interests in the UK through the vast £1.5bn logistics park it is building at London Gateway in the south-east part of its acquisition of P&O last year.

Its parent company, Dubai World, is known to be eyeing property acquisitions globally. It controls sovereign wealth fund Istithmar, which recently formed part of the consortium that bought London’s Metropole for £130m.

Wal-Mart appointed UBS to examine the options for selling Gazeley earlier this month in order to focus on its core business.

It has owned Gazeley since 1999, as part of its £6.7bn takeover of UK supermarket ASDA. Gazeley is the preferred developer for Asda’s distribution space in the UK, and for Wal-Mart’s warehouses globally.