US warehouse giant Prologis has disclosed a third takeover approach worth £13.5 billion for British property developer Segro, which has been rejected. The move escalates pressure on Segro's board to negotiate.
Details of the latest proposal
Prologis said it submitted a new cash-and-stock proposal on July 16 valuing Segro at £9.93 per share. This is higher than the initial £9.25 per share offer worth £12.6 billion made a month earlier, and an improvement on the second proposal tabled on July 10. The latest bid represents a 34% premium on Segro's closing share price of £7.42 the day before takeover interest became public, according to Prologis.
Prologis has now included a cash component of up to £2.7 billion, or 20% of the total bid. It is also considering a secondary listing in London following any potential deal, if there is sufficient investor demand. Prologis stated that such a listing would require engagement from Segro's board.
Prologis urges shareholder pressure
Prologis said: “Prologis believes the third proposal provides a compelling opportunity for both sets of shareholders and urges Segro shareholders to encourage their board to recommend the combination.” The US firm argued that shareholders face a “clear choice”, claiming its proposal offers “upfront value, greater flexibility and long-term upside opportunity”. In contrast, it said Segro's standalone plan relies on “flawless execution of a significant, long-dated development pipeline, substantial third-party funding and an unjustified valuation”.
Segro's previous stance
Segro last month described the initial approach as falling “a long way short of Segro's own views on value” and being “opportunistically timed” after recent share price pressure. Segro shares have dropped sharply from a peak above £14 in 2021 to just over £6 last year. The company has not publicly commented on the latest proposal.
Takeover deadline looms
Under City takeover rules, Prologis has until 5pm on July 22 to make a firm bid for Segro or walk away. The ongoing interest highlights a wave of overseas bids for British firms.
