US industrial property giant Prologis has raised its takeover offer for London-listed SEGRO to 1,031.7p per share, valuing the British warehousing firm at roughly £8.9bn. The revised bid, which combines cash and Prologis shares, represents a significant premium to SEGRO's closing price before the approach became public.
SEGRO shares surged 4.2% in early trading on Thursday to 1,028p, just below the offer price, as investors welcomed the improved terms. The FTSE 100 index edged up 0.3% to 8,210 points, with SEGRO among the top gainers. Analysts at Peel Hunt noted the revised offer 'appears to reflect the strategic value of SEGRO's urban logistics portfolio in a tightening supply market.'
The proposed merger would create a global logistics property titan spanning the US, Europe, and the UK. SEGRO's assets include major distribution centres near London and in the Midlands, while Prologis holds a vast portfolio of warehouses serving e-commerce and supply chain clients. Industry observers say the consolidation reflects the growing demand for last-mile logistics space driven by online retail.
For UK investors and pension holders, the deal underscores the premium attached to prime industrial property. SEGRO is a significant holding in several UK equity income funds and defined-contribution pension schemes. If completed, shareholders would receive a mix of cash and Prologis stock, potentially altering the geographic and sector exposure of their portfolios. The transaction is subject to regulatory approval from UK competition authorities and shareholder votes.
Prologis stated the combination would 'deliver enhanced scale and operational efficiencies' across both companies' portfolios. SEGRO's board is understood to be evaluating the revised proposal with its advisers. No formal recommendation has been issued yet, but sources indicate the improved terms are likely to receive a warmer reception than the initial approach, which was rejected as undervaluing the business.