Statement re Possible Combination
Summary by AI BETAClose X
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.
THIS ANNOUNCEMENT IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE"). THERE CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE MADE.
FOR IMMEDIATE RELEASE
9 July 2026
Combining SEGRO and Prologis - A Credible Path to Value Creation
Following constructive engagement with SEGRO plc's ("SEGRO") shareholders and the presentation published by SEGRO yesterday, Prologis, Inc. ("Prologis") today published a new investor presentation to help shareholders further assess the significant potential benefits of a combination of Prologis and SEGRO.
Prologis believes constructive engagement with Prologis remains the best path for the Board of SEGRO to maximise long-term value for SEGRO shareholders and wider stakeholders, for four compelling reasons:
1. Prologis brings both a superior platform and a larger data center opportunity
2. Prologis' platform creates advantages that cannot be replicated by SEGRO
3. SEGRO's public market valuation reflects its structural constraints
4. The strategic rationale is clear - constructive engagement creates the best outcome
1. Prologis Brings Both a Superior Platform and a Larger Data Center Opportunity
Prologis has an established data center platform with end-to-end capabilities to convert power into data center value. It is staffed to deliver on the substantial data center opportunity with a dedicated data center team of 75+ people along with a 250+ person development team, 175+ person in-house energy team and a 35+ person procurement team. Prologis has a proven track record for execution and monetisation from its data center platform.
Prologis' power pipeline of 5.8GW across approximately 30 projects (less than 1% of the Prologis portfolio) is either secured or in advanced stages, with a longer-term estimate of 10GW+ with meaningful potential upside and more than 150 projects with power applications under review.
SEGRO shareholders have the opportunity to benefit from a more experienced, larger and better-capitalised data center platform that can capture and maximise the long-term value of both companies' data center pipelines as well as the upside from Prologis' broader embedded power potential.
2. Prologis' Platform Creates Advantages That Cannot be Replicated by SEGRO
SEGRO's reliance on project-level joint ventures underscores the capital constraints it faces as a standalone company. Under these structures SEGRO shareholders will give away significant value and upside to joint venture partners while, unlike Prologis, not earning any fees or promotes that would amplify returns.
Prologis believes this highlights SEGRO's capital and capability deficiencies, giving away a share of the potential return to a partner, whilst constraining SEGRO's ability to deploy capital competitively at pace. The development activity within the Pure Data Center joint venture, and future joint ventures for fully fitted data center development per the strategy set out by SEGRO, is funded by high leverage at a loan-to-cost ratio of approximately 70%.
A combination with Prologis offers SEGRO shareholders a stronger path to value creation than project-level joint ventures. It would allow SEGRO shareholders to participate in the upside of SEGRO's pipeline while benefiting from Prologis' scaled, global platform, fortress balance sheet and established strategic capital platform.
3. SEGRO's Public Market Valuation Reflects its Structural Constraints
SEGRO's portfolio value is transparent with third-party valuations carried out every six months. Based on its 31 December 2025 valuation, SEGRO's asset value comprised 88% completed assets and 12% development properties and land sites valued using the residual method.
SEGRO's consensus forecast earnings growth for the next three years is lacklustre, particularly in comparison to its European logistics peers. Based on analyst consensus, SEGRO's forecast EPS CAGR for the period from 2025 to 2028 is 4.7% compared to a 7.1% forecast EPS CAGR for European logistics peers. That growth outlook does not support a premium market valuation particularly given that SEGRO already trades on a much higher price to earnings ratio than its European logistics peers.
Prologis notes SEGRO management's new adjusted earnings guidance of 50 pence per share by 2030 which implies a compound annual growth rate of 6.4%. This will require a higher growth rate in the later years of the forecast based on the lower near-term consensus growth. This growth will require significant investment and new capital, and is by no means certain.
4. The Strategic Rationale is Clear - Constructive Engagement Creates the Best Outcome
The proposed combination offers SEGRO shareholders a substantial upfront premium and participation in a long-term value opportunity through ownership of the combined platform.
Customers would benefit from Prologis' global platform, deep local leadership and expertise as well as proven execution across leading logistics markets that support increasingly international supply chains. Communities will continue to benefit from Prologis' long-term investment approach and sustained investment in skills and partnerships.
Prologis has a significant footprint across Europe and has operated in the UK for nearly 30 years. The combination supports the U.K.'s growth agenda through continued investment in strategic logistics infrastructure, strengthening supply chain resilience and creating long-term economic opportunity.
Constructive engagement
Prologis remains ready to engage constructively with the SEGRO Board and believes that a collaborative dialogue would enable both companies to explore the full potential of a combination and ensure shareholders are able to evaluate all available opportunities.
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 investor presentation published today is available on Prologis' website at https://ir.prologis.com/potential-offer-for-segro-disclaimer, subject to certain restrictions.
There can be no certainty that an offer for SEGRO will be made. A further announcement will be made as appropriate.
Enquiries:
|
Prologis, Inc. Tim Arndt, Chief Financial Officer Justin Meng, Global Head of Investor Relations & Strategic Initiatives Jennifer Nelson, Senior Vice President, Global Communications
|
+1 (415) 394-9000 +1 (347) 544-1393 +1 (510) 708-8462
|
|
Rothschild & Co Alex Midgen Matthew Greenberger Sam Green
|
+44 (0) 207 280 5000 |
|
J.P. Morgan James Robinson Saravanan Nagappan Thomas Grier
|
+44 (0) 20 3493 8000 |
|
Eastdil Secured Max von Hurter
|
+44 (0) 20 7074 4950 |
|
BofA Securities Ed Peel Stephen Little Geoff Iles Jeff Horowitz
|
+44 (0) 20 7628 1000 |
|
Brunswick Group Simon Sporborg Nina Coad Stuart Hudson Ed Brown |
+44 (0)20 7404 5959 |
Linklaters LLP is retained as legal adviser to Prologis.
Further information
N.M. Rothschild & Sons Limited ("Rothschild & Co"), which is authorised and regulated by the Financial Conduct Authority (the "FCA") in the United Kingdom, and J.P. Morgan Securities LLC, together with its affiliate J.P. Morgan Securities plc (which conducts its UK investment banking business as J.P. Morgan Cazenove and which is authorised in the United Kingdom by the Prudential Regulation Authority ("PRA") and regulated in the United Kingdom by the PRA and the FCA) (together "J.P. Morgan"), Eastdil Secured International Limited ("Eastdil Secured" or "ESI") which is authorised and regulated by the Financial Conduct Authority (the "FCA") in the United Kingdom, and Merrill Lynch International ("BofA Securities"), which is authorised by the PRA and regulated by the FCA and PRA in the United Kingdom, are each acting exclusively for Prologis and for no one else in connection with the subject matter of this announcement and will not be responsible to anyone other than Prologis for providing the protections afforded to their respective clients or for providing advice in connection with the subject matter of this announcement. This announcement is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy or an invitation to purchase or subscribe for any securities or the solicitation of any vote in any jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, or pursuant to an exemption from registration under the Securities Act of 1933, as amended.
The release, publication or distribution of this announcement in jurisdictions outside the United Kingdom may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about, and observe such restrictions. Any failure to comply with such restrictions may constitute a violation of the securities law of any such jurisdiction.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s), save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.
Publication on Website
In accordance with Rule 26.1 of the Code, a copy of this announcement will be available subject to certain restrictions relating to persons resident in restricted jurisdictions on Prologis' website at https://ir.prologis.com/ promptly and in any event by no later than 12 noon (London time) on 10 July 2026. The content of this website is not incorporated into and does not form part of this announcement.
Forward-Looking Statements
The statements in this announcement that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations, estimates and projections about the industry and markets in which Prologis and SEGRO operate as well as management's beliefs and assumptions. Such statements involve uncertainties that could significantly impact Prologis' or SEGRO's financial results. Words such as "expects," "anticipates," "intends," "believes," "would", "could", "should" and "estimates," including variations of such words and similar expressions, are intended to identify such forward-looking statements, which generally are not historical in nature. All statements that address operating performance, events or developments that Prologis expects or anticipates will occur in the future - including statements relating to any possible transaction between Prologis and SEGRO , rent and occupancy growth, acquisition and development activity, including data center developments and power procurement related thereto, contribution and disposition activity, general conditions in the geographic areas where Prologis and SEGRO operate, expectations regarding new lines of business, Prologis' and SEGRO's debt, capital structure and financial position, Prologis' ability to earn revenues from co-investment ventures or form new co-investment ventures and the availability of capital in existing or new co-investment ventures - are forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict. Although Prologis believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, Prologis can give no assurance that its expectations will be attained, and therefore actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Some of the factors that may affect outcomes and results include, but are not limited to: (i) the ultimate outcome of any possible transaction between Prologis and SEGRO, including the possibility that SEGRO will continue to reject any proposed transaction with Prologis; (ii) uncertainties as to whether SEGRO will cooperate with Prologis regarding any proposed transaction; (iii) the effect of the announcement of any proposed transaction on the ability of Prologis and SEGRO to operate their respective businesses and retain and hire key personnel and to maintain favourable business relationships; (iv) the timing of any proposed transaction; (v) the ability to satisfy closing conditions to the completion of any proposed transaction (including shareholder approvals); (vi) other risks related to the completion of any proposed transaction and actions related thereto; (vii) international, national, regional and local economic and political climates and conditions; (viii) changes in global financial markets, interest rates and foreign currency exchange rates; (ix) increased or unanticipated competition for Prologis' or SEGRO's properties; (x) risks associated with acquisitions, dispositions and development of properties, including those specific to data center development and the integration of the operations of significant real estate portfolios; (xi) maintenance of Real Estate Investment Trust ("REIT") status, tax structuring and changes in income tax laws and rates; (xii) availability of financing and capital, the levels of debt that Prologis and SEGRO maintain and their credit ratings; (xiii) risks related to Prologis' investments in and management of its co-investment ventures, including the ability to establish new co-investment ventures; (xiv) risks of doing business internationally, including currency risks; (xv) environmental uncertainties, including risks of natural disasters; (xvi) risks related to global pandemics; and (xvii) those additional factors discussed under Part I, Item 1A. Risk Factors in Prologis' Annual Report on Form 10-K for the year ended December 31, 2025. Prologis undertakes no duty to update any forward-looking statements appearing in this announcement except as may be required by law.
Sources and Bases
· Loan-to-cost of 70% for the Fully Fitted joint venture strategy is as set out on page 23 of 08/07/2026 management presentation
· SEGRO's portfolio value composition is as at 31 December 2025 and as disclosed the SEGRO 2025 Annual Report and SEGRO 2025 Full Year Results Property Analysis
· SEGRO's EPS compounded annual growth is as per the average of consensus estimates. This has been compiled from available research analysts. The average excludes research from connected advisers. The forecast compiled without the agreement or approval of Segro.
· SEGRO's EPS compounded annual growth rate is calculated based on the Full Year 2025 earnings per share and the EPS estimate for the 2028 financial year, per consensus
· European Logistics Peers comprise Argan, CTP, Montea, Tritax Big Box and Warehouses De Pauw
· The European Logistics Peers EPS forecasts are as per FactSet. The peer CAGR represents the simple average of the peers respective forecasts
· SEGRO 2030 earnings per share guidance of 50 pence as announced by SEGRO on 08/07/2026.
· SEGRO EPRA NTA sourced from SEGRO's 2025 Annual Report and Accounts, with prior years' EPRA NTA sourced from its 2024 and 2023 Annual Report and Accounts and its 2024 and 2023 interim results.
· Prologis' power pipeline as of 2Q26 is as set out on page 5 of Prologis' 09/07/2026 investor presentation.
SEGRO Earnings per share consensus forecast
|
Analyst |
Date |
Dec-26E |
Dec-27E |
Dec-28E |
|
|
|
|
|
|
|
Societe Generale |
25-Jun-26 |
38p |
40p |
42p |
|
Berenberg |
31-Mar-26 |
39p |
40p |
42p |
|
Barclays |
30-Mar-26 |
38p |
39p |
39p |
|
Deutsche |
20-Mar-26 |
38p |
40p |
42p |
|
Peel Hunt |
05-Mar-26 |
39p |
41p |
44p |
|
Kepler Cheuvreux |
02-Mar-26 |
39p |
39p |
40p |
|
Panmure Liberum |
02-Mar-26 |
39p |
40p |
42p |
|
Shore Capital |
26-Feb-26 |
39p |
42p |
45p |
|
Jefferies |
20-Feb-26 |
38p |
39p |
41p |
|
Mean |
|
38p |
40p |
42p |
|
|
|
|
|
|
|
High |
|
39.0p |
42.0p |
45.3p |
|
Low |
|
37.8p |
38.8p |
39.4p |
|
|
|
|
|
|
|
Connected Advisors |
|
|
|
|
|
Bank of America |
25-Jun-26 |
38p |
38p |
39p |
|
Goldman Sachs |
25-Jun-26 |
39p |
41p |
43p |
|
UBS |
27-Apr-26 |
39p |
41p |
43p |
|
JP Morgan |
04-Mar-26 |
39p |
41p |
n.a. |
Note: Mean excludes research from connected advisers. Forecast compiled without the agreement or approval of SEGRO
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