US's Prologis goes directly to shareholders with third offer for Segro
Prologis Inc on Monday made its case publicly to Segro PLC shareholders, after a third takeover offer for its logistics property peer was rejected by the Segro board.
San Francisco, California-based Prologis said its sweetened its all-share offer for London-based Segro and added a partial cash alternative.
It is offering 0.0890 of a new Prologis share for each Segro share, which values the FTSE 100 listing at 993 pence per share or £13.5 billion in total. Prologis notes the offer price is a 9.7% premium to Segro's adjusted net asset value of 905p per share at June 30.
Segro shares were down 1.3% to 886.20p early Monday in London, giving the company a market capitalisation of £12.00 billion. Prologis shares closed down 0.2% to USD149.79 in New York on Friday for a USD139.65 billion market cap.
The new Prologis offer includes a partial cash alternative of 1,000p per Segro share, capped at £2.7 billion.
As Segro shareholders would own 9.2% of the enlarged company, Prologis said it will "explore the feasibility" of a secondary listing on the London Stock Exchange, if there is "sufficient investor demand". It added: "For any such secondary listing to be feasible, Prologis expects that Segro board engagement with Prologis will be required."
The Segro board has rejected the latest proposal, Prologis said, as it had the two previous offers. The first one, in late June, was for 0.0840 Prologis share for each Segro share, which valued Segro shares at 925p.
The second was made on July 10 and rejected on July 12, Prologis said, while the third offer was made on Thursday last week and rejected on Friday. It didn't provide the value of the second offer, but Segro on Monday said it was 0.0875 of a Prologis share for each Segro share.
Segro confirmed it received and the board unanimously rejected the latest Prologis offer. However, it said it met with Prologis management on Sunday "to understand Prologis' ability to improve its financial terms to a level that could be capable of being recommended by the board of Segro".
No new information was provided by Prologis at the meeting, Segro said, and no improvement was made to the third offer.
"Should Prologis submit an improved proposal that more appropriately reflects the value of Segro's compelling prospects, Segro would continue to make themselves available to engage further with Prologis," Segro said. It noted it also had received a takeover approach from Prologis in 2024, which was rejected.
The Segro board previously said it believes the company is worth more than £13 per share.
Prologis made its case directly to Segro shareholders on Monday, saying: "Prologis' proposal provides upfront value, greater flexibility and long-term upside opportunity. Segro's standalone plan relies on flawless execution of a significant, long-dated development pipeline, substantial third-party funding and an unjustified valuation."
Segro responded: "The board is seeking to maximise value for shareholders and would further engage on any proposal which appropriately reflects the considerable embedded value and prospects of our business." It asks shareholders to take no action on the Prologis takeover proposal.
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