Renewi rejects £636m takeover offer from Macquarie, shares surge

Renewi surged on Thursday as it emerged the waste management company had rejected a £636m cash takeover offer from Macquarie Asset Management.

Macquarie said in a statement that it made a proposal at 775p a share on 25 September.

It noted that the offer price represents a multiple of 8.4x EBITDA for the year ended 31 March 2023 and said this compares favourably to the trading multiples of Renewi's listed peers in the European waste and resource recovery sector.

"The proposal provides a compelling opportunity for Renewi's shareholders to realise their investment for cash at a very significant premium and at an attractive multiple," Macquarie said.

"Macquarie believes that Renewi's ability to deliver its stated ambition will remain constrained under the current capital structure by the limited near-term operating cash flow and limited leverage capacity. In a challenging macro and cost of capital environment, Macquarie believes the proposal represents an attractive alternative for shareholders, attributing a full and fair valuation for the company's future potential."

But Renewi said in a statement that it rejected the offer on Thursday morning as it "fundamentally undervalues" the company and its prospects.

At 1350 BST, Renewi shares were up 38% at 702.30p.