Segro, a major player in the warehouse and industrial property sector, has agreed to acquire its competitor, Tritax EuroBox, in a deal valued at approximately £552 million. The all-share transaction offers Tritax shareholders 68.4p per share, representing a 27 percent premium on the company’s closing stock price as of May 31. Including Tritax’s debt, the total value of the deal rises to around £1.1 billion.
This acquisition presents Tritax EuroBox shareholders with a significant and immediate increase in the value of their investment, along with the potential for stronger total returns.
The acquisition follows a period of interest from Brookfield Global Asset Management, which announced in June that it was exploring a cash offer for Tritax. In July, Tritax confirmed it had received multiple expressions of interest, including from Brookfield, and had been reviewing various proposals since early June.
Tritax Chairman Robert Orr commented on the offer, noting the challenging economic backdrop for the property sector. He emphasized that the Segro deal provides an opportunity to acquire a high-quality portfolio of large warehouses in key European markets, enhancing Segro’s existing assets.
Segro’s CEO, David Sleath, highlighted the strategic fit of the acquisition, stating: “This transaction allows us to acquire a premium portfolio of big-box warehouses in Europe, which will complement and strengthen our current holdings. By internalizing the management of Tritax’s portfolio upon completion, we can benefit from economies of scale through our existing local operations.”
Segro currently owns industrial and warehousing properties across the UK and Europe, while Tritax’s assets are spread throughout continental Europe.
Analysts are watching the deal closely. Oli Creasey, a property analyst at Quilter Cheviot, noted that while the terms of the deal appear reasonable, it is uncertain if Tritax shareholders will accept the offer. Creasey also pointed out that Brookfield could return with a rival all-cash bid, as they have until September 23 to submit a firm proposal.
“The pricing of the deal seems fair, and Segro should be commended for not overpaying,” Creasey said. “However, given that speculation around a potential bid has already boosted Tritax shares by 24 percent in recent months, it’s unclear if shareholders will approve this deal. Brookfield’s potential cash offer could sway the final decision, despite the board’s recommendation in favour of Segro.”
