EUROPE - ProLogis has extended its mandatory tender offer to buy all remaining shares in ProLogis European Properties (PEPR) at €6.10 after being rejected by the management of the listed real estate fund.

PEPR management said the offer on 21 April to take the European logistics fund private was inadequate. ProLogis has extended the deadline of the offer to 11 May.
US-based ProLogis originally floated PEPR on Euronext Amsterdam in 2006 and has retained a stake in the fund.

The company has since increased its holding in PEPR from 33% to 38%, and raised this further to 39% by acquiring more shares.

But the management of PEPR said it considered ProLogis's offer to be "inadequate from a financial point of view".

Peter Cassells, chief executive at PEPR, said: "In assessing the offer, we have consulted with our independent PEPR board members and received external legal and financial advice.

"Based on our strategy, business plans and the quality of our portfolio, the offer does not reflect the full value potential of PEPR."

Geoffrey Bell, chairman of PEPR's board, said: "The independent members of the PEPR board have carefully considered the reasoned opinion of the management company and unanimously endorse its conclusions."

But ProLogis said it would extend its offer deadline from 6 May 6 to 11 May and would not be changing any financial terms of the offer. The settlement of the offer is expected to take place on 18 May.

Walter Rakowich, chief executive at ProLogis, said: "ProLogis's unconditional mandatory offer gives PEPR investors the choice either to realise certain and immediate value through the tender of their units or to remain investors to realise PEPR's long-term upside potential.

"ProLogis is offering liquidity to all unit-holders through its tender offer, but fully intends to continue as a significant owner and manager of PEPR to create long-term value at PEPR for the benefit of all unit-holders who choose to remain invested."

ProLogis's move to mount a takeover of PEPR was prompted by a similar move by Dutch asset manager APG and Australia's Goodman Group, which would have seen the latter take over as fund manager.