Logistical leap

28 October 2019 By Anna Szymanski Follow @Three_Guineas

Industry giant Prologis’s $9.7 bln offer for Liberty is the latest in a slew of such deals. Investors are balking at the 21% premium, but buyers are betting last-mile goods delivery will turn into a gold rush. And M&A bankers get a place to ply their trade in a slowing market.

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Logistics real-estate company Prologis on Oct. 27 said it has agreed to buy commercial real-estate rival Liberty Property Trust in an all-stock deal worth $9.7 billion. Prologis will also take on almost $3 billion of Liberty’s debt.

Prologis expects that the two real-estate investment trusts will, once combined, be able to cut $120 million in costs, with another $50 million in "incremental development value creation" possible over time.

In addition, Prologis intends to dispose of $2.8 billion-worth of non-strategic logistics properties and $700 million of office properties.

BofA Securities and Morgan Stanley are advising Prologis, while Goldman Sachs and Citigroup are working with Liberty Global.

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