Macquarie is buying waste company Renewi in a deal worth £636 million
A UK waste management company has rejected a “borderline hostile” £636m takeover bid from Australian predator Macquarie.
London-listed Renewi rejected the 775 pence per share offer yesterday morning, saying it “fundamentally undervalues” the company.
But Macquarie – which has been dubbed the “vampire kangaroo” in the past – published its proposal anyway and called on the Renewi board to engage “constructively” in a deal.
Analysts described the move as “borderline hostile” and said it showed Macquarie “won’t go down without a fight”.
Shares in Milton Keynes-based Renewi rose 38.7 per cent, or 197p, to 706p.
Clean up: Renewi rejected the 775 pence per share offer, saying it “fundamentally undervalues” the company.
The nosedive will fuel fears that foreign interests are trying to buy up British companies cheaply.
Renewi provides waste management services to six local authorities in the UK, including Doncaster, Cumbria and East London, although the majority of its business is based in the Netherlands and Belgium.
The company, with 6,000 employees and 174 locations across Europe, converts waste into paper, metal, plastic, building materials, compost and energy.
Macquarie approached Renewi with the offer on Monday before it was rejected yesterday. The Australian group revealed the details after the rejection, saying: “Macquarie invites the board to work constructively to agree the terms of a recommended transaction to be presented to Renewi shareholders.”
“Macquarie highlights the difficult macroeconomic environment impacting various sectors, including waste management, and the impact of such an environment on the value of the company.”
It said the recycling company’s ambitions are currently “constrained” due to its existing capital structure.
Renewi said it had examined the proposal closely but believed it undervalued the company. A spokesman said: “The board urges shareholders not to take any action at this time.”
Macquarie, which manages almost half a trillion pounds worth of assets, has until October 26 to announce whether it will make a formal takeover bid for the company.
Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said Macquarie’s “bold moves suggest it won’t go down without a fight”.
She said: “This takeover bid was borderline hostile, but the market reaction was very positive.” Despite Renewi turning down the deal, there is a lot of excitement, and a big part of that will be the excitement that other, more lucrative deals could be on the way. “