- Sydney-based Macquarie is often nicknamed the ‘Vampire Kangaroo’ by critics
Australian investment giant Macquarie has struck a deal to buy the UK-listed waste management firm Renewi for £700million.
The Sydney-based asset manager – often nicknamed the ‘Vampire Kangaroo’ by critics – has reached a preliminary agreement valuing Renewi at 870 pence per share.
This represents a 57 per cent premium to the company’s share price on Wednesday and a 41 per cent premium to Renewi’s average stock price over the previous three months.
In a joint statement, the two groups said the proposal was final and would not be increased, barring a third party announcing a potential bid or a ‘firm intention’ to make a better offer for Renewi.
Macquarie attempted a £636million acquisition of the FTSE 250 business last year before walking away after Renewi turned it down.
The former Thames Water owner has gained support for its latest offer from Coast Capital, Paradice Investment and Avenue Europe International, which collectively own 19 per cent of Renewi’s shares.
If the acquisition is finalised, Macquarie intends to provide capital to advance Renewi’s strategy, support the group’s current transformation programmes and ‘fully safeguard’ the employment rights of its staff members.
Bosses at Renewi said they were optimistic regarding their ‘prospects as a pure-play market leader in Europe’s most advanced recycling markets.’
They added: ‘The board is also confident in Renewi’s strategy and execution plan to deliver a step change in margins and cash flow.’
Following the deal’s announcement, Renewi shares skyrocketed by 44.8 per cent to 802p, making them the FTSE All-Share Index’s biggest riser.
Renewi’s roots date back to a construction business set up in 1880 by Guy Shanks and Andrew McEwan that helped build Scotland’s railway system.
Since the late 1980s, the Milton Keynes-based company has been listed on the London Stock Exchange, expanded into Europe, and sold its landfill and gas power assets.
It also changed its name from Shanks Group to Renewi in 2017 after the former merged with the Dutch recycling firm Van Gansewinkel.
The business now has operations across four countries: Belgium, France, the Netherlands, and Portugal, having sold its UK municipal division to Biffa for £131million last month.
Upon agreeing the sale in May, Otto de Bont, chief executive of Renewi, described it as a ‘transformational milestone’ that would boost its cash flow and profit margins and enable it to concentrate on expanding across Europe’s recycling markets.
Renewi’s planned sale to Macquarie comes amidst a frenzy of foreign firms snapping up London-listed companies, which are often perceived as undervalued in contrast to their international peers.
In recent months, cybersecurity specialist Darktrace, video games services firm Keywords Studios, and music rights investor Hipgnosis Songs Fund have all succumbed to overseas ownership.
Investment platform Hargreaves Lansdown, Robinsons Squash producer Britvic, and Royal Mail owner International Distribution Services have also struck billion-pound takeover deals.
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