Waste manager Renewi accepts £700m offer from Macquarie in latest UK takeover

Australian investment giant Macquarie has agreed a deal to buy UK-listed waste management company Renewi for £700m.

The Sydney-based asset manager, often dubbed the ‘vampire kangaroo’ by critics, has agreed a preliminary deal valuing Renewi at 870 pence per share.

This represents a 57 percent premium to the company’s share price on Wednesday and a 41 percent premium to Renewi’s average share price over the previous three months.

In a joint statement, the two groups said the proposal was final and would not be increased unless a third party announced a potential bid or a “firm intention” to make a better offer for Renewi.

Macquarie attempted to acquire the FTSE 250 business worth £636m last year before pulling out after being rejected by Renewi.

The former owner of Thames Water has won support for its latest bid from Coast Capital, Paradice Investment and Avenue Europe International, which together own 19 per cent of Renewi’s shares.

If the acquisition is completed, Macquarie intends to provide capital to advance Renewi’s strategy, support the group’s ongoing transformation programs and “fully safeguard” the employment rights of its staff.

Renewi bosses said they were optimistic about its “prospects as the sole 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.”

After the announcement of the agreement, renewal actions They soared 44.8 per cent to 802 pence, making them the biggest gainer on the FTSE All-Share index.

Renewi’s roots date back to a construction company 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 Dutch recycling company Van Gansewinkel.

The company now has operations in four countries – Belgium, France, the Netherlands and Portugal – and last month sold its UK municipal division to Biffa for £131 million.

Agreeing the sale in May, Otto de Bont, Renewi’s chief executive, described it as a “transformational milestone” that would boost its cash flow and profit margins and allow it to focus on expanding into Europe’s recycling markets.

Renewi’s planned sale to Macquarie comes amid a frenzy of foreign companies snapping up London-listed companies, which are often perceived as undervalued compared to their international peers.

In recent months, cybersecurity specialist Darktrace, video game services company Keywords Studios and music rights investor Hipgnosis Songs Fund have all succumbed to foreign ownership.

Investment platform Hargreaves Lansdown, Robinsons Squash producer Britvic and Royal Mail owner International Distribution Services have also completed takeover deals worth billions of pounds.