Australia's Macquarie set to buy Renewi for $887 mln in latest UK deal

Macquarie MQG has proposed buying waste management company Renewi RWI for 700.9 million pounds ($886.8 million), the companies said on Thursday, more than a year after the asset manager's first attempt to take over the British firm.

The move comes amid a flurry of merger and acquisition activity in Britain, with U.S.-based Fortress Investment Group announcing on Thursday a deal to buy British cafe-bar and restaurant chain Loungers LLGRS for an enterprise value of about 350.5 million pounds.

On Wednesday, insurer Direct Line DLG rejected a 3.28 billion pound bid from bigger rival Aviva AV..

Renewi shares soared as much as 47% to 816 pence, their highest since August 2022, but below the proposed offer price of 870 pence per share in cash. That price would be a 57% premium to Renewi's closing price on Wednesday.

Renewi's board said it would be willing to recommend the deal if Macquarie tabled a formal offer before a regulatory deadline of Dec. 26.

Britain's stock markets have underperformed many foreign counterparts in recent years, while falling interest rates are also encouraging potential buyers.

The possible offer, which Macquarie said was final, follows a number of approaches the Australian firm has made to Renewi.

In October last year, Renewi rejected an 810 pence per share proposal from Macquarie, having turned down another approach before that.

Macquarie said it planned to support Renewi's current strategy, while Renewi said it would give the Australian firm access to its books to conduct due diligence.

($1 = 0.7904 pounds)