Segro Rejects Prologis's £12.6 Billion Takeover Bid

Segro, a FTSE 100 company, has publicly rejected a £12.6 billion takeover bid from U.S. rival Prologis, branding the offer "opportunistic, one-sided and inadequate." The UK-based warehouse and data center group argues that the 925p-a-share proposal fails to recognize its significant potential for rental income growth, estimated to exceed £1 billion in the coming years.

In a defense statement to investors, Segro highlighted a valuation of approximately £13 per share from commercial property firm CBRE, which would place its market value closer to £18 billion. The company also announced plans for a joint venture to develop a data center in Paris and reported a substantial increase in rents during the first half of the year.

Segro's chief executive, David Sleath, emphasized the unique and irreplaceable nature of the company's asset base, accumulated over more than a century. He noted the dual growth opportunities in industrial and logistics development, which is gaining momentum, and in the data center sector, where limited site availability presents a valuable opportunity.

Segro contends that Prologis is attempting to acquire the company at a reduced price, pointing to a share price drop following geopolitical tensions. Shares were trading at 841.2p at the end of February and fell to 742p before Prologis's bid was disclosed last month. The 25% premium offered by Prologis appears less substantial when compared to pre-conflict share prices.

While Segro has not definitively closed the door on a takeover, Sleath indicated that the company would "react accordingly if something came back at a more attractive level." Some investors have expressed strong opposition, with one top-ten investor reportedly calling the Prologis bid "highway robber" if they acquired Segro at the proposed price.

This situation follows a trend of U.K. companies being targeted by foreign bidders. Earlier this year, Schroders, Beazley, and Intertek have accepted takeover offers. In a separate development, airline Easyjet is considering a £5.2 billion offer from U.S. private equity firm Castlelake.

Segro shares saw a slight decrease of 1.8%, or 16p, closing at 865p following the announcement.