Prologis to Acquire UK's Segro for $18.8 Billion in European Logistics Expansion

U.S. industrial real estate giant Prologis has agreed to acquire British competitor Segro Plc in an $18.8 billion deal, a move that will create the world's dominant logistics property company with a combined $269 billion in assets.

The transaction, announced Tuesday, significantly expands Prologis's presence in Europe amid surging demand for industrial and warehouse space.

Transaction Details

The agreement values Segro at approximately £14.3 billion. Under the terms, Segro shareholders are set to receive 0.0920 new Prologis shares for each share they hold.

• Implied Value: The offer values Segro at 1,031.7 pence per share, representing a 14.4% premium to its net asset value of 902 pence.
• Cash Alternative: A partial cash option is available for up to 25% of the total consideration, or £3.5 billion. Shareholders choosing this option would receive 258 pence in cash and 0.0690 new Prologis shares.
• Shareholder Stake: Segro shareholders who opt for the standard share consideration will own approximately 8.9% of the combined company, according to an analyst note from Jefferies cited in the report.

Strategic Rationale

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The acquisition is a strategic push by Prologis to consolidate its leadership in the global logistics sector. The combination will expand Prologis’s European operating portfolio by 47% to 368 million square feet and increase its European land bank by 126%.

"This deal brings together SEGRO’s exceptional portfolio and customer relationships with Prologis’ global platform, operating expertise and financial strength," Prologis Chief Executive Daniel S. Letter said in a statement. Segro CEO David Sleath called the combination "a compelling platform" that unites his firm's portfolio with Prologis's "global scale, customer franchise and operational capabilities."

Financial Outlook and Closing

Prologis stated the deal is expected to have a broadly neutral to minimally dilutive effect on its Core Funds From Operations (FFO) per share in the first full year after completion. The company expects to maintain its A2/A credit ratings from Moody’s and S&P.

The transaction, which has been unanimously recommended by Segro's board, does not require a vote from Prologis shareholders. It is conditional on approval from Segro shareholders, regulatory clearances, and a secondary listing for Prologis on the London Stock Exchange. The deal is expected to close in the first half of 2027.