Analyst Note
| Kevin Brown, CFA |After increasing its offer from what it had proposed a month ago, no-moat Prologis announced that it has reached an agreement to acquire no-moat Duke Realty in a deal estimated to be worth $25.6 billion (which includes the assumption of $3.8 billion in debt). Prologis increased its all-equity offer to 0.475 of its own shares for each share of Duke Realty held, up from the 0.466 exchange rate announced in its May 2022 offer. Based on Prologis' closing share price of $117.24 on June 10, that values Duke at $55.69 per share, which is roughly in line with our $53 per share fair value estimate. Given that the value of the deal is still dependent on movements in Prologis' stock price (which fell 7% June 13 on news of the increased offer), we do not currently anticipate changing our fair value estimate for Duke Realty.