Prologis tables 'best and final' £14bn offer for Segro

US real estate firm Prologis has tabled a "best and final" £14bn offer for Segro, the FTSE 100 property company it has been pursuing for weeks. The Californian company's latest proposal values Segro at £10.32 per share, describing it as a "compelling opportunity for both sets of shareholders."

This bid marks the latest step in a lengthy takeover struggle between the two property investors, who have traded strongly-worded barbs in an attempt to win over shareholders.

Offer Details

Prologis, which manages approximately $98bn in assets, has proposed to exchange 0.0920 shares for each Segro share, plus £3.5bn in cash.

Analysts at Stifel had previously suggested that Segro would accept an £11.10 per share offer, though this latest bid falls just short of that mark.

Segro had already rejected two new bids from Prologis over the weekend, with the latest valuing the firm at £13.5bn.

Shareholders Urge Talks

The FTSE 100 company has not yet responded to Prologis's latest offer. The US firm has urged Segro to extend its "put up or shut up" deadline beyond 5pm today to discuss the new proposal.

Segro had previously attacked its US suitor for tabling "opportunistic, one-sided and inadequate bids." The companies' management teams met on Sunday, but the talks initially failed to yield an agreement.

On Tuesday, Norges Bank — which owns 8.3% of Segro and 1.3% of Prologis — urged the two real estate firms to enter talks.

"We believe the proposal merits consideration, and we encourage the boards of both Segro and Prologis to enter into constructive discussions," the $2.3 trillion fund said.

Prologis operates two joint ventures with Norges:

• Prologis European Logistics Partners: Worth €2.4bn when established in 2013
• Prologis US Logistics Venture: Founded in the same year with an initial $1bn footprint

On Wednesday, APG Asset Management — which holds 2.3% of Prologis and 5.1% of Segro — called on the two parties to engage in "constructive and meaningful dialogue."

'This Is Our Final Offer'

The tussle between the two property firms descended into a slanging match on Tuesday, as the companies exchanged blows over the ages of their chief executives.

Dan Letter, chief executive of Prologis, said: "There is no doubt a combination of both companies would deliver meaningful value.

"We have listened to feedback from shareholders and this morning, we have improved our proposal to make a compelling offer to the SEGRO Board. We run Prologis with discipline and this is our best and final offer."

Market Reaction

Segro shares rose nearly 4% on Wednesday. The stock's value had nearly halved over the last five years but has soared in recent weeks following Prologis's interest.