SAN FRANCISCO, June, 3 2011
/PRNewswire/ -- AMB Property Corporation (NYSE: AMB) and ProLogis
(NYSE: PLD) today announced the completion of their merger, forming
a combined company named Prologis, Inc., a leading global owner,
operator and developer of industrial real estate. The common stock
of the combined company will trade under the symbol PLD on the New
York Stock Exchange beginning today.
“This merger brings together two great organizations to form an
even stronger global industrial real estate company,” said
Hamid R. Moghadam, chairman and
co-CEO. “We are excited to move forward with a clear strategy to
pursue growth opportunities around the world with our high-quality
portfolio of logistics properties, proven private capital business,
financial strength and our talented team.”
“Prologis is poised for a bright future,” said Walter C. Rakowich, co-CEO. “With an unmatched
global network, an excellent board of directors and a strong
management team, we are primed to deliver on the promise of great
products and service for our customers, career opportunities for
our people and sector-leading returns for our stockholders.”
Transaction Information
As a result of the merger, each former ProLogis common share has
been converted into the right to receive 0.4464 of a newly issued
share of the combined company's common stock. Each share of AMB
common stock will remain as one share of the combined company's
common stock. Former ProLogis common equity holders hold
approximately 60 percent of the combined company's common stock,
and former AMB common equity holders hold approximately 40
percent.
Accretion / Cost Savings
The transaction will create synergies and be immediately
accretive, with the full expected annual gross savings of
approximately $80 million in G&A
to be realized by the end of 2012. The company anticipates it will
have an improved cost of capital with greater financial flexibility
and that its expanded footprint will generate increased revenue
opportunities by allowing it to better serve the needs of its
customers.
Leadership and Operations
Moghadam, AMB's former CEO, and Rakowich, ProLogis' former CEO,
will serve as co-CEOs of the combined company through December 31, 2012, at which time Rakowich will
retire and Moghadam will become sole CEO. Until then,
Moghadam will focus on shaping the company's vision, strategy and
private capital franchise, and Rakowich will focus on operations,
specifically the integration of the two platforms and the
optimization of merger synergies. In addition, Moghadam will be
chairman of the Board and Rakowich will serve as chairman of the
Board's executive committee.
The company's corporate headquarters will be in San Francisco, and the company's operations
headquarters will be in Denver.
The combined company is structured as an UPREIT.
Board of Directors
Besides Moghadam and Rakowich, the members of the Board of
Directors include: Lydia H. Kennard,
J. Michael Losh, Jeffrey L. Skelton and Carl B. Webb, former members of the board of
directors of AMB; and George L.
Fotiades, Christine N.
Garvey, Irving F. Lyons III,
D. Michael Steuert and William D. Zollars, former members of the board
of trustees of ProLogis. Irving F. Lyons
III will serve as lead independent director.
One Team
"Today's merger closing is a significant achievement, and I want
to thank our colleagues around the world for their incredible
efforts to get us to this point," Moghadam said. "The long-term
success of any merger depends on the people. I continue to have
confidence in the future of this company because we are fortunate
to have the best team in the industry."
"We have moved swiftly and deliberately on integration planning,
and I am very pleased with our progress," Rakowich said. "While
there is still much work to be done to fully implement our plan, we
have the people, systems and processes in place to begin executing
as a combined company today."
Advisors
Morgan Stanley acted as financial advisor to ProLogis, and
Greenberg Traurig and Mayer Brown acted as legal advisors to
ProLogis. J.P. Morgan Securities LLC acted as financial advisor to
AMB, and Wachtell, Lipton, Rosen & Katz acted as legal advisor
to AMB.
About Prologis, Inc.
Prologis, Inc., is a leading owner, operator and developer of
industrial real estate, focused on global and regional markets
across the Americas, Europe and
Asia. As of March 31, 2011, on a pro forma basis giving
effect to the merger, Prologis owned or had investments in, on a
consolidated basis or through unconsolidated joint ventures,
properties and development projects expected to total more than 600
million square feet (55.7 million square meters) in 22 countries.
The company leases modern distribution facilities to more than
4,500 customers, including manufacturers, retailers, transportation
companies, third-party logistics providers and other
enterprises.
Some of the information included in this press release contains
forward-looking statements, such as future opportunities for the
combined company, improved cost of capital, increased revenue
opportunities, the pending retirement of any of the individual's
mentioned and the approximate cost savings, which are made pursuant
to the safe-harbor provisions of Section 21E of the Securities
Exchange Act of 1934, as amended, and Section 27A of the Securities
Act of 1933, as amended. Because these forward-looking statements
involve risks and uncertainties, there are important factors that
could cause our actual results to differ materially from those in
the forward-looking statements, and you should not rely on the
forward-looking statements as predictions of future events. The
events or circumstances reflected in forward-looking statements
might not occur. You can identify forward-looking statements by the
use of forward-looking terminology such as "believes," "expects,"
"may," "will," "should," "seeks," "approximately," "intends,"
"plans," "pro forma," "estimates" or "anticipates" or the negative
of these words and phrases or similar words or phrases. You can
also identify forward-looking statements by discussions of
strategy, plans or intentions. Forward-looking statements are
necessarily dependent on assumptions, data or methods that may be
incorrect or imprecise and we may not be able to realize them. We
caution you not to place undue reliance on forward-looking
statements, which reflect our analysis only and speak only as of
the date of this report or the dates indicated in the statements.
We assume no obligation to update or supplement forward-looking
statements. The following factors, among others, could cause actual
results and future events to differ materially from those set forth
or contemplated in the forward-looking statements: changes in
general economic conditions in California, the U.S. or globally (including
financial market fluctuations), global trade or in the real estate
sector (including risks relating to decreasing real estate
valuations and impairment charges); risks associated with using
debt to fund the company's business activities, including
refinancing and interest rate risks; the company's failure to
obtain, renew, or extend necessary financing or access the debt or
equity markets; the company's failure to maintain its current
credit agency ratings or comply with its debt covenants; risks
related to the merger with ProLogis, including litigation related
to the merger, and the risk that the merger may not achieve its
intended results, including that the expected synergies will not be
realized, or will not be realized during the expected time period;
the risks that the businesses will not be integrated successfully;
disruption from the merger making it more difficult to maintain
business and operational relationships; risks related to the
company's obligations in the event of certain defaults under
co-investment venture and other debt; defaults on or
non-renewal of leases by customers, lease renewals at lower than
expected rent or failure to lease properties at all or on favorable
rents and terms; difficulties in identifying properties, portfolios
of properties, or interests in real-estate related entities or
platforms to acquire and in effecting acquisitions on advantageous
terms and the failure of acquisitions to perform as the company
expects; unknown liabilities acquired in connection with the
acquired properties, portfolios of properties, or interests in
real-estate related entities; the company's failure to successfully
integrate acquired properties and operations; risks and
uncertainties affecting property development, redevelopment and
value-added conversion (including construction delays, cost
overruns, the company's inability to obtain necessary permits and
financing, the company's inability to lease properties at all or at
favorable rents and terms, and public opposition to these
activities); the company's failure to set up additional funds,
attract additional investment in existing funds or to contribute
properties to its co-investment ventures due to such factors as its
inability to acquire, develop, or lease properties that meet the
investment criteria of such ventures, or the co-investment
ventures' inability to access debt and equity capital to pay for
property contributions or their allocation of available capital to
cover other capital requirements; risks and uncertainties relating
to the disposition of properties to third parties and the company's
ability to effect such transactions on advantageous terms and to
timely reinvest proceeds from any such dispositions; risks of doing
business internationally and global expansion, including
unfamiliarity with the new markets and currency risks; risks of
changing personnel and roles; losses in excess of the
company's insurance coverage; changes in local, state and federal
regulatory requirements, including changes in real estate and
zoning laws; increases in real property tax rates; risks associated
with the company's tax structuring; increases in interest rates and
operating costs or greater than expected capital expenditures;
environmental uncertainties and risks related to natural disasters;
and our failure to qualify and maintain our status as a real estate
investment trust. Our success also depends upon economic
trends generally, various market conditions and fluctuations and
those other risk factors discussed under the heading "Risk Factors"
and elsewhere in our most recent annual report on Form 10-K for the
year ended December 31, 2010 and our
other public reports.
SOURCE AMB Property Corporation