The FTSE100 is better known for dividend stocks than semiconductor companies. However, that doesn’t mean its shares can’t explode higher.

Shares in secret (LSE:SGRO) are up at least 16% today (Wednesday, June 24) on news of a takeover bid by Prologue. And this is becoming a familiar theme for British investors…

What’s on the table?

Prologis’ offer values ​​Segro at 925 pence per share. This represents a 24.6% premium to Tuesday’s closing price of 742p.

Sounds good. However, it is exactly equal to the company’s reported net asset value (NAV) at the end of 2025.

This is an opportunistic move by Prologis. Segro’s management has unequivocally rejected this offer, but there are a few things to consider.

One is that UK real estate investment trusts (REITs) typically trade below NAV. Therefore, investors looking to sell may not have a better opportunity.

However, I suspect that most shareholders are they are not I want to sell. The primary reason for owning REITs is for passive income, not capital appreciation.

REITs enjoy the tax benefits of returning their earnings to shareholders in the form of dividends. But there’s an even bigger reason to be cautious.

Please note that tax treatment depends on each client’s individual situation and may change in the future. The content of this article is for informational purposes only. It is not intended to be and does not constitute any form of tax advice.

What’s the catch?

Prologis is not offering anything above the full value of Segro’s shares. But a closer look reveals that it’s even worse.

The entire offer is available in stock. Prologis shares are currently trading at 145% bonus to NAV, which changes the equation.

This means that Segro would convert net assets worth £1 into net assets worth 41p. That’s like selling a magazine for £100 and buying an identical one for £245.

As a result, the adjusted deal value is well below 925 pence per share. Therefore, the FTSE 100 company rejected the deal.

Prologis has until July 22 to submit another offer, and I think it can do so. Discounts to NAV have made UK REITs attractive takeover targets.

Buying Segro shares ahead of a potential offer looks like a tempting transaction. But I’m very wary of this strategy.

Mergers and acquisitions in the UK

Searching for foreclosure deals first is a unsafe game. Gamma Communication is a good example of what can go wrong.

The company’s shares are down about 15% over the past month, with no major changes to the business. The main difference is that its potential takeover status has changed.

Gamma went from having four potential buyers to one. As a result, the share price falls.

The Management Board is actively examining the possibility of sale. However, the prospect of a bidding war leading to a higher price is gone – at least for now.

It is no different in the case of Segro – Prologis’ offer was not ordered. However, investors should be wary of the similarities.

In both cases, the focus should be on the company’s long-term prospects. Ultimately, this is what provides the greatest protection against the risks associated with investing.

What to do

Segro’s features – supply-constrained locations, long-term leases, steady dividend growth – won’t disappear if the deal doesn’t go through. However, at current prices, the margin of safety has narrowed significantly.

This week’s more useful lesson is to find these qualities elsewhere – before someone else does. The UK REIT sector is shrinking, so the opportunity to own high-quality logistics assets at a discount to NAV may not last forever.

Should you invest £5,000 in Segro Plc now?

If investing expert Mark Rogers and his team have stock advice, it can pay to listen. After all, Twelfth Magpie’s flagship Share Advisor newsletter, which it has run for almost a decade, provides thousands of paying members with the best share recommendations from across the UK and US markets.

Mark believes there are 6 standout stocks that investors should consider buying right now. Want to check if Segro Plc is on the list?

Stephen Wright owns shares of Gamma Communications.