UK-listed warehouse group Segro has rejected a third takeover proposal from US logistics giant Prologis, worth £13.5 billion ($18.2 billion), escalating a standoff just two days before a deadline to formalise a deal under British takeover rules.
The high-stakes battle pits the world’s largest industrial real estate company against Europe’s premier warehousing operator.
Prologis, a San Francisco-headquartered company with more than US$200 billion in assets under management globally, has been actively expanding its footprint in high-demand, supply-constrained European logistics hubs.
The rejected proposal valued Segro at 993 pence per share, made up of 0.0890 Prologis shares for every Segro share plus a partial cash alternative of up to £2.7 billion. Prologis said the offer represented a near 34 per cent premium to Segro’s share price before its interest became public.
Segro’s board disagreed.
“The Board does not believe that Prologis’s latest proposal to acquire Segro reflects the quality, scarcity or long-term prospects of Segro’s portfolio and platform,” chairman Andy Harrison said in a statement.
Prologis and Segro confirmed the US group had first proposed a takeover in March 2024, which was also turned down.
Shares in FTSE 100-listed Segro fell as much as 2.2 per cent on the rejection before recovering some ground, and have gained nearly 21 per cent since Prologis’ interest became public on 24 June.
Kepler Cheuvreux analyst Frederic Renard told Reuters that Segro’s rejection was “hardly surprising given that it has effectively anchored its valuation expectations at around 1,300 p (A$24.84),” adding that “we believe some shareholders are increasingly vocal in arguing that the board should engage with Prologis.”
Prologis pushed back on Segro’s defence of its own growth strategy, arguing it relies on “unrealistic risk assessments and assumptions” to arrive at its net asset value and earnings projections.
The company said it “remains convinced” a combination would create long-term value, while noting “highly disciplined capital allocation has always been fundamental to our strategy.”
“We remain ready to engage constructively at any time in the interests of all shareholders,” Prologis said.
Founded in 1920, Segro is the UK’s largest industrial landlord, controlling roughly 10.9 million square metres of urban “last-mile” warehouses and distribution space across eight European countries. Crucially, the company has also been rapidly building out a power-secured data centre development pipeline to capture soaring demand driven by the artificial intelligence industry – a segment its board views as a core driver of its long-term valuation.
Under UK takeover rules, Prologis faces a deadline to make a formal offer or walk away.