ProLogis (PLD), one of the leading global providers of distribution facilities rejected a bid for a 33.1% ownership stake in ProLogis European Properties (PEPR) by investor group APG Algemene Pensioen Groep N.V. (APG) and Goodman Group on behalf on an undisclosed consortium.
ProLogis intends to retain its stake and management agreement with PEPR, a publicly traded fund consisting of distribution and logistics facilities in Europe. As per the letter of interest issued by the investor group, ProLogis’ stake has been valued at € 378 million or € 6 per unit. The offer also included the condition that ProLogis would have to transfer its PEPR’s management rights to Goodman Group.
In response to the letter, ProLogis conveyed that it has no plans of selling its stake or giving up the management of PEPR. A major reason for the strength and success of PEPR is ProLogis’ management which provides industrial management expertise combined with a global finance network. ProLogis’ ownership and management is one of the major reasons for the continued interest and investment of unit holders in PEPR.
ProLogis owns and manages interests in distribution facilities, service offices, and properties spanning 435 million square feet of space. The company leases its industrial facilities to over 3,800 customers, which mostly include manufacturers, retailers, transportation companies, third-party logistics providers and other enterprises with large-scale distribution needs.
ProLogis currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, PS Business Parks Inc (PSB) currently retains a Zacks #2 Rank, which translates into a short-term Buy rating.
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