Macquarie bids £700m for waste management company Renewi

Shares in the London-listed waste management company Renewi soared by almost 50 per cent following an announcement that Macquarie, the Australian asset manager, has launched a £700 million takeover tilt.
The proposed cash offer of 870p per share represents a 57 per cent premium to Renewi’s closing price of 554p on Wednesday and comes just over a year after a previous bid by Macquarie at 810p was rebuffed for “fundamentally’ undervaluing the company. Shares closed up 46.7 per cent, or 259p, to 813p on Thursday.
This time, the board said that it would be minded to recommend the deal to shareholders if a formal offer is tabled by the regulatory deadline of December 26.
In a statement to investors, board members said that the deal would help deliver a “step change” in margins and cash flow while crystallising a “meaningful premium” to the Renewi share price for shareholders.
While the FTSE 250 company may no longer be a household name, it traces its history back to Shanks & McEwan, one of the great industrial companies whose Victorian heritage was founded on building the railways in Scotland.
It rebranded as Renewi in 2017 and, based in Milton Keynes, has shifted from civil engineering to waste management, focusing on recycling and making energy from waste with a focus on operations in the Netherlands and Belgium.
It sold its last British municipal business to Biffa for £130 million, to exit the UK market which it had previously described as “unpredictable”. It claims its recycling efforts prevent more than 2.5 million tonnes of CO₂ emissions annually.
Macquarie said it had obtained irrevocable undertakings from the company’s three largest shareholders — Coast Capital Management, Avenue Europe and Paradice Investment Management — which collectively control about 15.1 per cent of its shares.
The Sydney-based asset manager, which has been criticised for its stewardship of Thames Water when it was a shareholder, said that it would provide support and capital to implement Renewi’s strategy as a “pure-play waste-to-product” company and would safeguard employment rights, including pension rights.
It added: “The financial terms of the final possible offer are final and will not be increased, save that a third party announces a possible offer or firm intention to make an offer on better terms.”
Renewi’s engagement with Macquarie has been protracted, with the company rejecting an 810p per share proposal in October 2023 and an earlier approach before that.
The company said: “Renewi shareholders are advised to take no action in relation to this matter. Further announcements will be made when appropriate. There can be no certainty that any offer will be made.”
Macquarie has made a series of waste management acquisitions in the past three years, including Irish-based Beauparc, which it valued at close to €1 billion. It also holds stakes in British wind farms, electric vehicle networks, Southern Water and the national gas pipeline.
The proposal comes amid broader challenges for UK-listed companies, with Britain’s equity markets underperforming global counterparts and spurring a flurry of deal-making.