Summary
Prologis, Inc. (PLD) announced on February 10, 2015, a significant acquisition of industrial and retail properties valued at approximately $820 million. This transaction, structured as a contribution agreement, involves the acquisition of interests in various LLCs and partnerships that own these properties. The acquisition will be financed through a combination of common limited partnership units (OP Units) and a new class of convertible units (Class A Units) in Prologis' operating partnership, Prologis, L.P. This move indicates Prologis' continued strategy of expanding its real estate portfolio. The issuance of OP Units and Class A Units is being conducted under an exemption from SEC registration requirements, assuming investors are accredited. The deal is subject to satisfactory due diligence and customary closing conditions, with an expected closing date of April 30, 2015. The structure involving convertible units suggests a forward-looking approach to capital allocation and potential future equity dilution considerations for existing shareholders.
Key Highlights
- 1Prologis to acquire a portfolio of industrial and retail properties for approximately $820 million.
- 2Transaction structured as a contribution agreement with Morris Realty Associates LLC and other contributors.
- 3Acquisition financed through the issuance of Prologis L.P. OP Units and a new Class A Convertible Common Units.
- 4Issuance of units is expected to be exempt from SEC registration requirements, targeting accredited investors.
- 5Transaction is subject to a 45-day due diligence period and other customary closing conditions.
- 6Expected closing date for the transaction is April 30, 2015.
- 7Class A Units are convertible into OP Units, and OP Units are exchangeable for Prologis common stock after one year.