Further Announcement Regarding a Possible Combination of SEGRO and Prologis
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 IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY CODE ON TAKEOVERS AND MERGERS (THE "CODE") AND DOES NOT CONSTITUTE A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE. THERE CAN BE NO CERTAINTY THAT ANY FIRM OFFER WILL BE MADE.
SAN FRANCISCO, July 21, 2026 /PRNewswire/ --
Introduction
Following submission of our latest proposal, senior representatives of Prologis, Inc. ("Prologis") met with SEGRO plc ("SEGRO") management in London on Sunday. Having submitted a revised proposal only days earlier, the purpose of that meeting was not to present a further revised offer, but rather to understand whether there was a credible path to a transaction capable of recommendation by the SEGRO Board.
We were disappointed that the discussion did not provide meaningful clarity regarding the matters that would enable further progress.
SEGRO's aspirational valuation
Prologis is very active across the real estate markets in Europe. Prologis' assessment of SEGRO's value is grounded in the quality of its real estate and our expectations for its long-term performance. SEGRO's total property portfolio as at 31 December 2025 was valued at £19.0 billion. Of this, £16.7 billion was categorised as completed assets at an EPRA Net Initial Yield of 4.2 per cent. At market close on 20 July 2026 the UK 10-year Gilt had risen to 5.04 per cent.
In SEGRO's Trading Update published on 8 July 2026, it outlined that NAV had declined from 925 pence per share to 905 pence per share over the six months to 30 June 2026. The NAV reflects SEGRO's independent valuers' assessment of the value of all development land and property assets owned by SEGRO as at 30 June 2026. It is very unusual for a real estate defence document to publish a declining NAV during an offer period.
SEGRO has consistently traded at a significant discount to its EPRA NTA. As set out in our presentation published on 20 July 2026, Prologis believes this is not because of temporary market dislocation, the conflict in the Middle East or other factors cited by the SEGRO Board, but because the consensus forecast earnings for SEGRO on a standalone basis imply only 4.7 per cent annual growth over the next three years and 6.4 per cent through 2030, based on SEGRO's guidance 2030 EPS of 50 pence per share. The market requires a much better growth outlook to trade at EPRA NTA. SEGRO has not been able to raise its standalone forecast beyond this growth rate. That is because it has £16.7 billion of completed assets fully valued at an EPRA Net Initial Yield of 4.2 per cent.
Based on the see-through value of the proposal announced on 20 July 2026 of 993 pence per share, Prologis is offering SEGRO shareholders a 9.7 per cent premium to its latest pro forma adjusted NAV of 905 pence per share. This would be amongst the highest premiums to NAV paid for a UK real estate company in the last 10 years. It also represents the entry point into an exchange offer, that will allow SEGRO shareholders to benefit from Prologis superior earnings growth, liquidity, and rating than we believe they will receive from SEGRO standalone.
Prologis believes that the SEGRO defence relies on unrealistic risk assessments and assumptions to arrive at the various NAV uplifts and earnings projections. Even if we assume earnings of 50 pence per share in 2030, as set out in its presentation dated 8 July 2026, taking SEGRO's latest undisturbed share price to earnings multiple of 19.3x, this implies an undiscounted share price for SEGRO of 964 pence in four years' time. We are offering SEGRO shareholders more than that today.
Conclusions
The SEGRO Board rejected our March 2024 Proposal in 72 hours, saying "we see no merit in the proposed combination". Prologis believes that decision has left SEGRO shareholders 36.5 per cent worse off. We believe the SEGRO Board is repeating that mistake.
Prologis remains convinced that a combination would create substantial long-term value. However, highly disciplined capital allocation has always been fundamental to our strategy and our responsibility to Prologis shareholders.
We remain ready to engage constructively at any time in the interests of all shareholders.
There can be no certainty that an offer for SEGRO will be made. A further announcement will be made as appropriate.
Important Code Notes
In accordance with Rule 2.6(a) of the Code, Prologis is required, by not later than 5:00 pm (London time) on 22 July 2026, to either announce a firm intention to make an offer for SEGRO in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer for SEGRO, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline may only be extended with the consent of the Takeover Panel in accordance with Rule 2.6(c) of the Code.
In accordance with Rule 2.5(a) of the Code, Prologis reserves the right to vary the form and/or mix of consideration as set out in this announcement and/or introduce other forms of consideration. Prologis reserves the right to make an offer for SEGRO at a lower value and/or on less favourable terms than those described in this announcement: (a) with the agreement or recommendation of the Board of SEGRO; (b) if a third party announces a possible or a firm intention to make an offer for SEGRO which, at that date, is of a value less than the value implied by the its proposal; or (c) following the announcement by SEGRO of a Rule 9 waiver transaction pursuant to Appendix 1 of the Code or a reverse takeover (as defined in the Code). If after the date of this announcement SEGRO declares, makes or pays any dividend or distribution or other return of capital to its shareholders, Prologis reserves the right to make an equivalent reduction to terms of the proposal or an equalisation dividend to a common date.
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 22 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 respective 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
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
SOURCE Prologis, Inc.