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Prologis makes third bid for Segro, which is again rejected

The revised offer values Segro at about $18.2B, including a partial cash option of up to £2.7B, and would give Segro shareholders a roughly 9.2% stake in Prologis.

Reported · Written up by our desk · REITs

Segro has again rejected a takeover offer from Prologis, despite receiving a third bid valued at around £13.5B, or about $18.2B, Prologis announced Monday. The price represents a 9.7% premium to Segro’s estimated net asset value as of the end of June, according to the terms shared by Prologis. Under the revised proposal, Prologis would increase the stock component to 0.089 new Prologis shares for each Segro share, a 6% upgrade from the initial plan, and add a partial cash option of up to £2.7B, roughly $3.6B. Prologis said existing Segro shareholders would hold about a 9.2% stake in Prologis, and it also plans to explore a secondary listing of Prologis shares on the London Stock Exchange. Segro’s board unanimously rejected the bid, characterizing it as opportunistic and arguing that the London-based REIT can deliver better value as a standalone company. Prologis disputed Segro’s valuation, saying the Segro assessment of value is unrealistic, and it said it can accelerate Segro’s growth strategy, particularly in the data center sector. Prologis’ first offer of £12.6B, about $16.6B, was disclosed June 24, followed by a second proposal earlier this month that was rebuffed on July 12, with those terms not disclosed. Segro said it remains open to further engagement, The Wall Street Journal reported, while Segro shares have risen nearly 21% since the takeover interest became public and Prologis shares were down about 2% late Monday morning trading.

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