INDIANAPOLIS — In a letter sent May 10 to Indianapolis-based Duke Realty Corp. (NYSE: DRE), San Francisco-based Prologis Inc. (NYSE: PLD) offered to acquire the firm in an all-stock transaction valued at $61.68 per share, which equates to about $23.7 billion. Under the terms of the proposal, Duke Realty stockholders would receive 0.466 shares of Prologis common stock for each share of Duke Realty common stock they own. The $61.68 figure is based on Prologis’ closing price on May 9, and represents a premium of 29 percent to Duke Realty’s closing price on the same date.
Hamid Moghadam, CEO and co-founder of Prologis, said he is confident that the proposed combination will be a win-win for both company’s shareholders. Prologis first sent a letter to Duke Realty on Nov. 29 regarding a potential transaction at an exchange ratio of 0.465, representing a 20 percent premium to Duke Realty’s stock price at the time. On May 3, Prologis increased the proposed exchange ratio, but Duke Realty rejected the proposal that same evening.
As of March 31, logistics real estate firm Prologis owned or had investments in properties and development projects totaling roughly 1 billion square feet in 19 countries. The company’s stock price closed at $132.35 per share Monday, May 9, up from $116.20 per share one year ago.
Duke Realty owns and operates approximately 162.4 million rentable square feet of industrial assets in 19 major U.S. logistics markets. The company’s stock price closed at $47.71 per share Monday, May 9, up slightly from $46.12 per share one year ago.
On May 11, Duke Realty responded to the acquisition proposal, stating that “the latest offer, virtually unchanged from its prior proposals, is insufficient.” That said, the firm remains open to “exploring all paths to maximize shareholder value.”