ProLogis to begin tender offer for ProLogis European convertibles

By Angela McDaniels

Tacoma, Wash., April 14 - ProLogis will launch a mandatory tender offer for the outstanding units and convertible preferred units it does not currently own in ProLogis European Properties, according to a company news release.

The tender offer is subject to approval by the Luxembourg regulator. It follows the purchase by ProLogis of about 11 million units of ProLogis European from an institutional investor, bringing ProLogis' ownership of ProLogis European to 38%.

ProLogis said it will offer €6.10 per unit and "an appropriate cash consideration" for the convertibles. The per-unit price is a 22% premium over the April 12 closing price.

The tender period will be open for two to four weeks.

Algemene Pensioen Groep NV and Goodman Group have made an indicative non-binding proposal to acquire ProLogis' stake in ProLogis European. They have not made an offer for all ProLogis European units but have stated that a price of €6.00 per unit would represent "a compelling value proposition for all unitholders," according to the news release.

ProLogis does not want to sell its interest in ProLogis European and said the tender offer "eliminates the instability and uncertainty" created by the proposal from Algemene and Goodman Group.

JPMorgan is acting as financial adviser to ProLogis.

ProLogis European Properties is a real estate investment fund that owns distribution and logistics facilities. The company is incorporated in Luxembourg and has headquarters in London.

ProLogis is a Denver-based provider of distribution facilities.

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