Prologis takes $16.6 billion bid for UK's Segro

Source Credit : Portfolio Prints

U.S. logistics giant Prologis on Wednesday publicly disclosed its £12.6 billion ($16.62 billion) takeover proposal for Britain's Segro after the warehouse landlord rejected its approach, escalating pressure on the board to engage with shareholders over a potential deal.

The move is the latest example of foreign buyers targeting London-listed companies, as subdued valuations continue to attract deep-pocketed overseas acquirers, putting Britain on track for a record year of takeover activity in 2026.

It also comes just days after Castlelake publicly unveiled its bid for easyJet following three unsuccessful attempts to secure the airline's support.



Prologis argued that FTSE 100-listed Segro has consistently traded at a discount to its net asset value and faces structural constraints that limit its ability to unlock value from its development projects and growing data centre pipeline, which is benefiting from the rapid expansion of artificial intelligence infrastructure.

"Prologis urges Segro shareholders to encourage the Segro board to engage with Prologis to allow a binding offer to be put to Segro shareholders for their consideration," the company said in a statement.

Segro shares jumped more than 20% to 892 pence, their highest level since September 2024.

Segro said its board had "unanimously and unequivocally rejected" the proposal, arguing that it significantly undervalued the company and describing the approach as "opportunistically timed".

Prologis is offering Segro shareholders 0.084 new Prologis shares for every Segro share held, implying a value of 925 pence per share, a premium of roughly 25% to Tuesday's closing price. However, the offer broadly aligns with Segro's most recently reported net asset value.

Recent transactions in the sector have produced mixed valuation outcomes. Blackstone's acquisition of Warehouse REIT was completed at a discount to book value, while the merger between British healthcare property investor Primary Health Properties and rival Assura was struck at a modest premium.

"In our view, Prologis would be reluctant to materially increase the offer and take it above net asset value," said Oli Creasey, head of property research at Quilter Cheviot.

The two companies have substantial overlap across Europe's key logistics markets, including the UK, France and Germany, potentially increasing regulatory scrutiny over any combination.

Panmure Liberum analyst Bjorn Zietsman questioned whether the current proposal sufficiently compensates shareholders for Segro's future earnings potential, long-term returns and strategic asset portfolio.

Prologis has a strong track record of acquiring warehouse-focused real estate investment trusts and improving returns. Since announcing those deals, it has generated returns of approximately 39% from Duke Realty, 97% from Liberty Property Trust and 166% from DCT Industrial.

Under UK takeover rules, Prologis has until July 22 to either submit a formal offer for Segro or walk away.