Real estate firm Segro is being urged by an activist investor to spin out its data center business into a separate company.

As reported by the Times, Lauro Asset Management has told Segro that the London stock market is “undervaluing” its high-growth data center division, suggesting the company spin off its data center arm and float a 20-30 percent stake in the Netherlands.

Segro, the FTSE 100 real estate investment trust, is a major owner of data centers in the UK, centered around Slough to the west of London.

Founded in 1920 and traditionally known for its industrial warehouse developments, Segro has been providing powered shells to data center customers for around 20 years.

The company has previously said it has some 500MW of data center capacity in operation or development around Slough. Known data center customers include Amazon, CyrusOne, Equinix, Iron Mountain, Virtus, GTR, and Pure.

It added that the data center opportunity within its portfolio equates to more than 2.5GW of further potential additional capacity across the UK and continental Europe, with 1.1GW available to pre-let by the end of 2028. The company is known to be targeting developments in France, and previously outlined potential to develop in Italy, Germany, and Poland in key cities such as Frankfurt, Milan, Warsaw, Paris, and Marseille.

All of its lettings to date have been to colocation providers, but the company is now also providing fully fitted-out data centers and targeting hyperscalers directly.

Segro declined to comment to the Times about Lauro’s proposals.

The Times quoted Lauro CEO David Mercurio as saying: “With its successful track record over the past 15 years, Segro’s management has more than earned the right to be bold in extracting significant value from its scarce and valuable data center assets. The logical next step is unlocking the embedded value of its data center portfolio through a partial sell-down and separate listing.”

Lauro has previously accused UK fast food chain Greggs of having “timid” leadership and called for millions of pounds in efficiency cuts.