Macquarie in £636m swoop on waste firm Renewi

A British waste management firm has rejected a ‘borderline hostile’ £636m takeover bid from Australian predator Macquarie.

London-listed Renewi turned down the 775p 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 urged the Renewi board to ‘engage constructively’ about a deal.

Analysts branded the move ‘borderline hostile’ and said it shows Macquarie ‘won’t be going down without a fight’.

Shares in Renewi, which is based in Milton Keynes, soared 38.7 per cent, or 197p, to 706p.

The swoop will fuel fears that overseas suitors are looking to snap up British companies on the cheap.

Renewi provides waste management services to six UK local authorities, including Doncaster, Cumbria, and east London, although most of its business is in the Netherlands and Belgium.

The company, which has 6,000 employees and 174 sites across Europe, turns waste into paper, metal, plastic, building materials, compost and energy.

Macquarie approached Renewi with the offer on Monday before it was rejected yesterday. Going public with the details after the rejection, the Australian group said: ‘Macquarie invites the board to engage constructively to agree the terms of a recommended transaction to be put forward to Renewi’s shareholders.

‘Macquarie notes the difficult macroeconomic environment, which is impacting different sectors including waste management, and the impact of such an environment on the value of the company.’

It said the recycling firm’s ambitions are currently ‘constrained’ under its existing capital structure.

Renewi said it had considered the proposal in detail but felt it undervalued the company. A spokesman said: ‘The board strongly urges shareholders to take no action at this time.’

Macquarie, which manages assets worth almost half a trillion pounds, has until October 26 to announce whether it will make an official bid for the company.

Sophie Lund-Yates, an equity analyst at Hargreaves Lansdown, said Macquarie’s ‘bold moves suggest it won’t be going down without a fight’.

She said: ‘This takeover bid was borderline hostile, but the market reaction has been very positive. Despite Renewi rejecting the deal, there’s a great deal of excitement swirling, and a large portion of that will be excitement that other, more lucrative, deals could be on the way.’