SerpApi.Org
A British data centre owner is set to accept a £14bn takeover offer from an American suitor in the latest blow to the London stock market.
Segro, which owns a significant hub of data centres in Slough, said on Wednesday that it would probably agree to a bid from Prologis after the warehousing giant improved its offer for the digital infrastructure business.
If it proceeds, the deal will be the largest takeover of a London-listed company this year.
Segro’s statement came minutes before a deadline for Prologis to either make a final, binding offer or walk away. That deadline has been extended to Aug 12.
The US company tabled what it called its “best and final” offer of £10.32 a share after months of pursuing Segro.
The all-share offer, which also includes a cash alternative if shareholders opt for it, is the fourth proposal Prologis has put to Segro’s board, with the others being rejected for undervaluing the company, according to Segro.
Segro had recently faced shareholder pressure to accept Prologis’s offer, including from shareholders at Norges Bank Investment Management and CCLA Investment Management.
Norges said on Tuesday that the deal “merits consideration” as it encouraged both boards to come to an agreement.
Segro was established as the Slough Trading Company in 1920 when its founders bought a First World War military repair depot and turned some of its old workshops into spaces that customers could rent.
Run by David Sleath, the chief executive, its property portfolio is now valued at £19bn and tenants include Amazon, DHL and Royal Mail.
London’s shrinking stock market
New York-listed Prologis has signalled that it will consider a secondary London listing of its shares after a takeover, which would allow shareholders to maintain some exposure to the combined group if a deal is agreed.
However, the loss of Segro is another blow for London’s shrinking stock market after a string of takeovers.
Outsourcer Mitie agreed to a £3.1bn takeover on Tuesday by private equity-owned rival OCS Group, the 11th takeover of a UK-listed company this year worth more than £1bn, according to AJ Bell.
Engineer Rotork also accepted a £4.1bn takeover offer last week by Swedish firm ABB.
Before these took place, analysts at Peel Hunt estimated that there have been 154 bids for UK companies worth more than £100m since 2023, with a total value of £165bn.
The deals are likely to reignite a debate regarding whether London is struggling to retain its biggest listed companies.
Ministers have introduced measures to boost the City’s competitiveness but overseas investors are spotting opportunities for cut-price acquisitions.
