Key facts
- FTSE 100 firm Segro has agreed to a £14.3bn takeover by U.S. rival Prologis.
- The deal is valued at up to £19.19 billion ($14.3 billion).
- Segro shareholders will receive 0.0920 Prologis shares or a partial cash alternative of up to £3.5 billion.
- The transaction is expected to be completed in the first half of next year.
- The offer represents a 42% premium to Segro's closing price on June 23.
FTSE 100 firm Segro has accepted a takeover offer from U.S. logistics firm Prologis in a deal worth up to £14.3 billion ($19.19 billion), following pressure from investors. The agreement, which adds to a record year for mergers and acquisitions in the UK, is set to complete in the first half of next year.
Segro's shares closed up 1.4% at £9.75, while Prologis shares were down 2.31% during U.S. trading hours. The company, which owns around 10.9 million square metres (117 million sq. ft) of space across Europe, had previously rejected three approaches from Prologis. Investors including APG Asset Management, Norges Bank, and CCLA Investment Management had urged the companies to engage in talks, stating a combination would be valuable.
Prologis and Segro believe the combination offers a compelling opportunity for Segro shareholders. As of Monday, the two companies had a combined market capitalisation of over $152 billion. Prologis counts Amazon, FedEx, and UPS among its customers, and both firms have been developing a data centre pipeline to capitalize on the booming AI industry.
The agreed offer includes 0.0920 Prologis shares, a partial cash alternative of up to £3.5 billion, and a potential final dividend. Segro shareholders will hold approximately 8.9% of the combined group. The offer represents a 42% premium to Segro's closing price on June 23, the day before Prologis publicly announced its interest. The companies had until August 12 to finalize the deal under UK takeover rules.