APG weighs its options on PEPR

Dutch pension fund Algemene Pensioen Groep (APG) said on Wednesday it is exploring all options with regard to its 12% stake in Euronext-listed closed-end fund, Prologis European Properties (PEPR).

'We do not exclude anything at the moment,' spokesperson Harmen Geers told PropertyEU, when asked whether the company will tender its PEPR shares to Denver-based logistics giant Prologis in response to its offer of EUR 6.10 per share. Earlier this week, PEPR's management rejected the offer as 'inadequate', saying it failed to reflect the full value potential of the Amsterdam-listed company.

The offer by PEPR's US parent company was triggered by a bid earlier last month by APG and Sydney-based Goodman Group which valued the shares at EUR 6 each. Last week Fir Tree Partners, a New York-based private investment firm that holds 4.3% stake in PEPR, also said it opposed the Prologis offer which it deemed as 'significantly' lower than PEPR's fair value. The minority shareholder noted that PEPR's net asset value is EUR 6.32 under EPRA standards but its 'true value' is even higher because commercial rents are rising as the global economy improves.

Geers declined to say whether APG and Sydney-based Goodman were now considering a counteroffer, but said it was 'encouraging' that Prologis was willing to listen to unitholders and extend the offer period until May 11. Originally the offer was due to expire on May 6.

'It is a good sign that Prologis has given unitholders more time to let the latest developments sink in, especially the fact that PEPR and Prologis seem to disagree on the bid. We now have a few more days to decide what we want to do.'

PEPR's portfolio comprises 232 distribution facilities, covering 4.9 million m² across 11 European countries with an estimated net market value of EUR 2.8 bn.

Prologis is currently finalising a merger with AMB Property Corporation which will create the world's biggest industrial REIT. Shareholders in the Denver-based group are expected to vote on the merger on June 1.