The proposed £12.6bn takeover bid by US real estate giant Prologis for FTSE 100 property company Segro has ignited fierce debate over the merits of a deal worth nearly 25% above Segro's closing share price at the time of the bid. With Prologis touting its offer as a "substantial upfront premium" and access to an expanded global network of data centres, it is clear that both parties have differing views on the value of their respective assets.
Segro has vigorously rejected the 925p per share offer, labelling it "opportunistic, one-sided and inadequate", highlighting a core tension in the proposed deal. The London-listed firm has invested heavily in its data centre operations in recent years, and is adamant that its portfolio holds greater value than Prologis'. This assessment is bolstered by Segro's announcement of a joint venture with a London-based data centre firm to develop a new facility in Paris, aimed at showcasing the company's independence and future growth potential.
Prologis, however, argues that a merger would provide Segro shareholders with access to a more experienced, larger and better-capitalised data centre platform, offering a "substantial upfront premium". Furthermore, the US firm claims that combining the two entities into a larger investment trust would stimulate economic growth within the UK by driving continued investment in vital logistics infrastructure, thereby enhancing supply chain resilience and fostering long-term economic opportunities.
The proposed deal has sparked controversy over the value of Segro's assets. Prologis has criticised Segro's reliance on joint ventures, suggesting that this approach forces the company to "give away significant value and upside" while earning no fees or promotions. Conversely, Segro asserts that its multi-billion-pound investment pipeline is projected to add at least 200p per share in value, with the company reporting a strong start to the current year, securing £53m in new headline rent during the first half of 2026, an increase from £31m in the previous year.
Segro's shares have seen a marginal rise of 0.2% to 867p on Thursday, marking a 21% increase year-to-date. The current offer represents a premium of nearly 25% on Segro's closing share price at the time the bid was made. As the debate rages on, one thing is clear: only time will tell whether Prologis' bid will ultimately succeed in acquiring FTSE 100 property company Segro.
Source: City A.M.