Prologis makes 'best and final' offer for Segro at ~$18.8B all-stock deal

Prologis (PLD) on Wednesday announced its 'best and final' proposal to acquire the British industrial property giant Segro Plc (SEGXF).

In June, PLD publicly disclosed an unsolicited £12.6B ($16.6B) all-stock acquisition proposal for Segro that was immediately and unequivocally rejected by Segro's board.

The proposal represented a 24.6% premium to Segro's June 23 closing share price and would leave Segro shareholders owning about 10.5% of the combined company. 

In its final offer, Prologis offered to acquire the entire issued and to-be-issued share capital of Segro for a 9.5% increase over the initial proposal. The offer comes to 0.0920 new PLD shares for each Segro share.

The offer values the issued and to-be-issued share capital at ~£14.0B ($18.8B).

The transaction also includes a partial cash alternative of up to £3.5B, representing a fixed price of 1,031.7 pence per Segro share.

The new offer represents a premium of 39.0% to the closing price of 742 pence per share on June 23, the day before the commencement of the offer period. It represents a premium of 41.3% to the 1-month volume-weighted average share price of 730 pence as of June 23.

The final offer represents a premium of 46.6% to the three-month volume-weighted average share price of 704 pence as of June 23.

Upon completion and assuming that the partial cash alternative is fully taken, Segro shareholders will hold ~8.9% of Prologis' issued share capital.

In connection with the transaction, the industrial REIT is exploring a secondary listing of its shares on the London Stock Exchange (LDNXF) (LSEGY).

"Prologis requests that Segro seek from the Takeover Panel an extension to the PUSU Deadline of 5 PM BST on July 22 to allow sufficient time to agree to the other terms and conditions of a recommended firm offer to be made on the financial terms of the Best and Final Proposal," the REIT said in a statement.