CORRECTED - UPDATE 2-AMB to buy ProLogis in bid to form warehouse giant

(Corrects headline to show AMB is purchasing ProLogis)

* Combined company to have $14 billion stock market value

* ProLogis shares to be converted into 0.4464 new AMB shr

* Combined portfolio of about 600 million square feet

NEW YORK, Jan 31 (Reuters) - AMB Property Corp AMB.N has struck a deal to acquire rival ProLogis (PLD.N) in one of the biggest real-estate deals since the financial crisis, creating the largest U.S. owner of warehouse and distribution centers.

The deal comes as ProLogis, the larger of the two companies, has been struggling with a mountain of debt. The new company initially will be run jointly by both current chief executives, but AMB CEO Hamid Moghadam will become sole CEO at the end of 2012.

The combined company was expected to have a stock market value of about $14 billion, AMB and ProLogis said in a statement on Monday.

Under the terms of the all-stock deal, each ProLogis common share will be converted into 0.4464 of a newly issued AMB common share, the companies said.

ProLogis shares closed at $15.21 on Friday, while AMB closed at $32.93.

The two companies said last week that they were in merger talks.

ProLogis owns or manages about 435 million square feet (40 million square meters) of real estate, mainly in the United States, Europe and Japan. San Francisco-based AMB has about 158 million square feet (15 million square meters) of space in the United States, China, Brazil and Mexico.

The deal is expected to close in the second quarter and the new company will have its headquarters in San Francisco. (Reporting by Martha Graybow; Editing by Derek Caney and Maureen Bavdek)