The Offer and Its Rejection
Segro, the FTSE 100 warehouse property developer, has rejected a £12.6 billion takeover approach from US rival Prologis, the latest sign of the appetite among overseas buyers for British companies.
The San Francisco-based real estate investment trust (REIT) disclosed that it had put forward an all-share proposal on 16 June, offering 0.084 new Prologis shares for each Segro share — equivalent to 925p per Segro share. The board of Segro unanimously turned down the approach on 23 June, citing concerns over valuation and strategic fit. Under the terms of the rejected proposal, Segro shareholders would have held approximately 10.5% of the combined group.
Prologis, formed in 2011 through the merger of AMB Property Corporation and Prologis, is the world’s largest logistics REIT, with a portfolio of more than 1.3 billion square feet across 20 countries in North America, Latin America, Europe and Asia. Its market capitalisation stood at about $131 billion as of 18 June, with a share price of $140.54. Prologis argued that the combination would give Segro shareholders an interest in a group with a $140.9 billion market capitalisation, which it said would “unlock, on closing, significant upside to the current share price”.
Segro itself is a leading owner, asset manager and developer of modern warehousing and industrial property. Founded in 1920 and converted to REIT status in 2007, it holds a portfolio of 10.9 million square metres (117 million square feet) valued at £22.0 billion, located in and around major cities and transport hubs across the UK and seven other European countries. Its properties include large “big box” distribution warehouses as well as urban warehousing close to population centres. The company’s share price had a 52-week range of between £603.00 and £844.60, closing at £9.65 on 17 June, well below its all-time high of £18.09 reached on 3 January 2022.
Analysts are divided on Segro’s prospects. Goldman Sachs recently upgraded the stock, citing strong lease momentum and consistent dividends, while Kepler downgraded it, pointing to limited upside. The board’s rejection of the Prologis bid suggests it sees greater value in its current independent strategy, which may include further expansion into data-centre development.
Wider Takeover Wave Hits UK
The approach for Segro comes amid what has been described as an “avalanche” of overseas bids for British firms, driven by persistently low UK valuations that make companies appear cheap to foreign buyers. The trend has raised concerns that the UK risks becoming an “incubator economy”, where domestic companies are nurtured only to be sold off to international acquirers rather than scaling into global champions. Julia Hoggett, chief executive of the London Stock Exchange, has highlighted the need for more domestic risk capital to support scaling companies.
On Monday, 23 June, easyJet rebuffed a £4.74 billion takeover approach from US investment fund Castlelake, which had been described as an opportunistic attempt to buy the airline “on the cheap”. Castlelake has until 5pm on Friday, 27 June to make a firm offer or walk away under UK takeover rules.
Last week, London-listed laboratory testing company Intertek agreed to a £9.5 billion takeover by Swedish investor EQT. The deal values Intertek at £61.08 per share, a 40% premium, and is expected to close in the fourth quarter of 2026 or the first quarter of 2027. Analysts estimate that foreign takeovers will push UK merger and acquisition volumes above £50 billion for 2025, with a substantial portion coming from US firms. The UK’s legal system, corporate governance and transparent regulatory environment are often cited as factors that enhance its appeal to international buyers.
The current geopolitical climate — including the war in Iran and the continuing oil shock — has further depressed share prices of some UK-listed companies, making them appear cheaper to potential acquirers, commentators note.
Prologis Goes Public
Prologis has publicly disclosed its rejected approach in an effort to win support from Segro’s investors. The US firm said it “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”.
Prologis described the combination as “a highly compelling opportunity” and stressed that Segro shareholders would receive shares in the world’s largest logistics REIT. The bidder has until 5pm on 22 July to make a formal, binding offer for Segro or withdraw its interest, under the City Code on Takeovers and Mergers (the “City Code”). The Code requires a bidder to secure acceptances from more than 50% of the target’s voting share capital to declare an offer unconditional, and restricts “poison pill” actions that would frustrate a takeover without shareholder approval and the consent of the Panel.
Prologis has a record of large-scale acquisitions, having bought Duke Realty for $23 billion in 2022 and Liberty Property Trust for $12.6 billion in 2020. The company’s stock has a 52-week range of $103.41 to $150.18.
