Prologis, the largest owner of warehouses and distribution centers in the world, said it had made an unsolicited proposal to buy Segro, a major UK and European warehouse landlord, in an all-stock deal valuing the British company at about £12.6 billion, or roughly $16.6 billion. Segro's board rejected the proposal, and Prologis made the approach public after it was turned down.
Under the proposal, submitted on June 16, Segro shareholders would receive 0.084 new Prologis shares for each Segro share, implying a value of 925 pence per share. That represented a 24.7% premium to Segro's closing price of 742 pence on June 23, the last trading day before the bid became public. A premium is the amount an acquirer offers above a target's recent share price to win over investors. Because the offer is all-stock, Segro holders would be paid in newly issued Prologis shares rather than cash, leaving them with a stake in the combined company.
Two giants of warehouse real estate
Both firms are real estate investment trusts, or REITs — companies that own income-producing property and pass most of their earnings to shareholders as dividends, typically in exchange for favorable tax treatment. Prologis is the world's largest logistics REIT, with a market value of roughly $139 billion and more than 1.2 billion square feet of space across 19 countries. Segro is a FTSE 100 constituent and one of Britain's largest listed property owners.
In taking the bid public, Prologis argued that Segro has traded at a persistent discount to its net asset value and faces balance-sheet constraints that limit its ability to fund its development pipeline. It pointed in particular to Segro's land for new warehouses and data centers, saying the combination would help "unlock significant embedded value" of that pipeline "spurred by the rapid growth of AI." The deal logic rests on long-running demand for logistics space tied to e-commerce, supply-chain reconfiguration and, increasingly, the power-hungry data centers behind artificial intelligence.
Segro pushes back
Segro's board rejected the offer firmly, saying it had "unanimously and unequivocally" turned it down, describing it as "opportunistically timed" and saying it "falls a long way short of Segro's own views on value," Investing.com reported.
Investors reacted quickly. Segro shares jumped about 16% after the disclosure, their highest level in well over a year, and the rally spread across the UK property sector, with the FTSE 350 Real Estate index rising about 5.2% as investors bet on further consolidation, Investing.com noted.
Whether Prologis returns with a higher offer is now governed by British takeover rules. Under the UK Takeover Panel's "put up or shut up" framework, Prologis has until July 22 to either announce a firm offer or step away for a period. Neither company has said publicly whether talks will resume — and any future bid would depend on price, and on Segro's board changing its stance.
