Industrial Consolidation Continues With European Giants Agreeing To $15B Merger
Another massive industrial REIT merger is on the table, two logistics heavyweights have announced.
French industrial landlord Argan and Belgian firm Warehouses De Pauw are planning to band together, creating a mammoth, pan-European logistics firm worth €13B ($14.8B), the companies announced Thursday.
“For more than 25 years, each of us has built a market-leading platform,” Argan founder Jean-Claude Le Lan and WDP CEO Joost Uwents said in a joint statement. “This industrial project takes both stories to European scale: one integrated platform, stronger for clients and shareholders alike.”
The all-stock merger, which has been approved by both companies’ boards but is still subject to regulatory and shareholder approval, will create an eight-country platform. Argan’s portfolio spans roughly 3.9M SF across 110 warehouses in France, while WDP owns around 8M SF.
Long-term Argan shareholder Predica, a Crédit Agricole Assurances subsidiary, has already confirmed its support of the merger and plans to back the deal at the shareholder meeting, according to a release.
Argan shareholders will receive three WDP shares for each Argan share they have, valuing the company at €79.22 ($90.16) per share.
WDP and Argan expect the deal to allow for debt optimization and increased operating efficiencies, creating €10M ($11.3M) of synergies within 12 months.
Argan shares have gained 14% year-to-date and were up 14% at $85 (€74.70) in early European trading Friday, The Wall Street Journal reported. WDP’s have grown by 1.8% since the start of the year but were down 1.1% at $25.61 (€22.50) early Friday.
The deal, first reported by the WSJ, is expected to be completed early next year.
The Argan-WDP merger announcement came the day after U.K.-based logistics giant Segro accepted the fourth and final takeover offer made by San Francisco-based Prologis, the world's largest industrial real estate company.
Prologis upped its offer by $500M Wednesday, proposing to buy Segro for $18.7B (£14B). The deal would be one of the largest-ever mergers of industrial REITs and is 14% above Segro’s estimated net asset value from the end of June.
Also this week, Brookfield and Canada Pension Plan Investment Board struck a $5.2B deal to take South Florida-based LXP Industrial Trust private.
