By Macquarie Asset Management is exploring the possibility of making a cash offer for Renewi, following the rejection of its earlier proposal worth £636.3 million ($772.2 million). The rejected offer was made on behalf of Macquarie’s managed funds at a price of 775 pence per share for the entire share capital of Renewi.
Renewi has confirmed that it received an unsolicited proposal from Macquarie, but after careful consideration, it believes that the offer significantly undervalues the company and its prospects. Despite this, Renewi remains confident in its future and anticipates significant value creation through the delivery of its medium-term growth plan.
In late October, Renewi will provide more detailed information on several key initiatives aimed at improving shareholder value. These initiatives include dedicated commercial plans to drive top-line growth, sustainable margin improvement, and a strategic evaluation with a possible sale of its UK Municipal business.
According to Macquarie, the offer presents a compelling opportunity for Renewi shareholders to obtain a cash return at a premium. Macquarie also believes that Renewi’s current capital structure limits the company’s ambition due to restricted operating cash flow and leverage capacity.
Macquarie has invited Renewi’s board to engage constructively in order to agree on the terms of a recommended transaction to be presented to shareholders. However, Renewi advises its shareholders to take no immediate action.
At market close on Thursday, Renewi shares rose by 197.0 pence (39%) to 706.0 pence.
Comments