Prologis announced Tuesday that it will move forward with a plan to acquire London-based logistics warehouse operator Segro. Prologis put forward its “best-and-final” offer last month, following multiple rejections from Segro’s board. The final price tag values Segro at $18.8 billion.
Prologis (NYSE: PLD) also announced Tuesday a public offering for 15 million shares of common stock to help fund the transaction. It expects to generate $2.1 billion in gross proceeds from the transaction. Underwriters J.P. Morgan and BofA Securities have a 30-day option to purchase up to an additional 2,250,000 shares.
Shares of PLD were down 2.8% to $140.15 in early trading on Tuesday, which was in line with the $140 offering price.
“We are pleased to have reached agreement with the SEGRO Board on a combination that we believe will create meaningful value,” said Prologis CEO Dan Letter in a news release. “This deal brings together SEGRO’s exceptional portfolio and customer relationships with Prologis’ global platform, operating expertise and financial strength.”
Adding Segro (LSE.SGRO) will expand Prologis’ European portfolio by 47% to 368 million square feet and give it a development pipeline on the continent totaling 13 million square feet.
The combined entity will have $269 billion of assets under management.
Segro’s stockholders will receive 0.092 new Prologis shares for each share held, with the option to receive up to 25% in cash.
The deal is expected to be neutral to slightly dilutive to Prologis’ funds from operations (core and adjusted) in the first full year following closing, which is scheduled for the 2027 first half.
Prologis will also seek a secondary listing on the London Stock Exchange.
Why it matters? The story highlights how logistics real estate is becoming an increasingly strategic and consolidated asset class.
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