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Merger activity increased last week with four new deals announced and one deal completed. There was a significant increase in SPAC activity as well with five new SPAC business combinations announced.
Duke Realty Corporation (DRE)
Duke Realty is an industrial REIT, with 153 million square feet of operating properties in 19 major logistics markets across the United States. In order to focus on its industrial properties, the company sold its medical office properties to Healthcare Trust of America (HTA) for $2.8 billion in May 2017. Duke Realty has an outstanding development pipeline of 9.7 million square feet totaling $1.4 billion that is 84% pre-leased. The REIT is down about 20% year-to-date, sports a yield of 2.18% and trades at 29 times trailing twelve months funds from operations (FFO).
After rejecting two prior offers from Prologis (PLD), Duke Realty entered into a definitive agreement to be acquired by Prologis in an all stock deal valued at $26 billion. Prologis had initially offered 0.465 of its shares in exchange for one equity share of Duke Realty on November 29, 2021 and again on May 10, 2022 offering 0.466 shares of Prologis common stock for each share of Duke Realty. Duke rejected both the offers claiming they were insufficient.