Logistics real estate giant Prologis will acquire industrial real estate firm Duke Realty in an all-stock transaction valued at approximately $26 billion, the companies said today. The deal is expected to close in the fourth quarter and is subject shareholder approval and other customary closing conditions, the companies also said.
The transaction will give Prologis properties in key U.S. geographies, including Southern California, New Jersey, South Florida, Chicago, Dallas, and Atlanta. On an owned and managed basis, the acquisition comprises: 153 million square feet of operating properties in 19 major U.S. logistics geographies; 11 million square feet of development in progress—about $1.6 billion in total expected investment; and 1,228 acres of land owned and under option with a build-out of approximately 21 million square feet, according to the companies.
The deal will also drive long-term earnings growth, Prologis said.
“This transaction increases the strength, size, and diversification of our balance sheet while expanding the opportunity for Prologis to apply innovation to drive long-term growth,” Tim Arndt, Prologis' chief financial officer, said in a press release announcing the deal. “In addition to generating significant synergies, the combination of these portfolios will help us deliver more services to our customers and drive incremental long-term earnings growth.”
Under the terms of the deal, Duke Realty shareholders will receive 0.475x a Prologis share for each Duke Realty share they own, an improvement from Prologis’ previous exchange offer of 0.466x, Prologis said.