REG-Renewi plc Renewi plc: Further response to possible offer announcement by Macquarie Asset Management (“Macquarie”)
28/09/2023 18:30
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Renewi plc (RWI)
Renewi plc: Further response to possible offer announcement by Macquarie
Asset Management (“Macquarie”)
28-Sep-2023 / 18:21 GMT/BST
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NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN,
INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION
OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION
THIS IS AN ANNOUNCEMENT FALLING UNDER RULE 2.4 OF THE CITY CODE ON
TAKEOVERS AND MERGERS (THE "CODE") AND DOES NOT CONSTITUTE AN ANNOUNCEMENT
OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CODE. THERE CAN
BE NO CERTAINTY THAT ANY OFFER WILL BE MADE, NOR AS TO THE TERMS ON WHICH
ANY FIRM OFFER MIGHT BE MADE
FOR IMMEDIATE RELEASE
28 September 2023
Renewi PLC (“Renewi” or the “Company”)
Further response to possible offer announcement by Macquarie Asset
Management (“Macquarie”)
Earlier today, the Board of Directors of Renewi (the “Board”) confirmed it
had received an unsolicited and highly conditional non-binding proposal
from Macquarie in relation to a proposed all-cash offer of 775 pence per
Renewi share for the entire issued, and to be issued, share capital of the
Company to be made by funds managed or advised by Macquarie (the
“Proposal”). The Proposal, which was subject to the satisfaction of a
broad number of pre-conditions, including the completion of due diligence,
was firmly rejected by the Board of Renewi.
The Board is confident in the Company’s future and, in particular, the
significant value creation opportunity it expects to realise for its
shareholders from the delivery of its medium-term plan. In its Capital
Markets Day on 4 October 2023, the Company will reinforce the significant
growth opportunity available to the Company, and provide further details
of the Board’s strategy focussing on several key initiatives that are
expected to catalyse value for shareholders through the strengthening of
Renewi’s financial and operational platform.
• Dedicated commercial plans to drive 5%+ top line growth: Supported by
the Company’s strong commercial proposition and the strategic
positioning of its core segments, Renewi has established dedicated
commercial plans to drive organic top line growth. It expects to grow
market share through superior customer propositions, further expansion
of recycling capabilities, and further enhancement in the second
material production quality to capitalise on a growing market
opportunity for low carbon secondary materials. While maintaining
disciplined capital allocation, the strong sectoral tailwinds combined
with Renewi’s attractive positioning give the Board confidence that
significant shareholder value can be realised from delivery of growth
opportunities over the coming years.
• Sustainable improvement in margins: Renewi has initiated a series of
near-term initiatives to enhance efficiency through simplification of
the organisation, streamlining administrative processes and fostering
a culture of continuous improvement. These actions will be
supplemented by progress in Renewi’s digital agenda, focused on
further improving customer related processes, digitising its back
offices and upgrading its asset management capabilities. Delivery of
these initiatives is expected to drive sustainable long-term margin
improvement, towards the Company’s target of high single digit % EBIT
margin.
• Improving Cash Conversion: The Company is targeting a material
improvement in free cash generation, to reach a conversion ratio of
40% of EBITDA by FY26 (1), through a removal of legacy costs and
reduction in exceptional costs as well as a move to higher asset
utilisation, leading to lower capex. This improved cash generation
will enable the Company to operate a more dynamic capital allocation
strategy that encompasses both investment-driven growth and improved
shareholder returns.
• Strategic evaluation of Renewi's UK Municipal business: In line with
Renewi's strategic commitment to sharpen its portfolio focus on its
core competence in the sorting and treatment of commercial waste, a
comprehensive review of its UK Municipal business is being undertaken.
The Company is actively exploring a range of options to achieve an
exit from this segment, with an outcome targeted during the first half
of 2024. The Board believes the Company’s ongoing exposure to this
segment is a key impediment to shareholder value creation and believes
significant operational, financial and capital allocation benefits
will be derived from delivery of a successful exit.
Renewi has confidence that delivery of its standalone operational plan
will realise value for all its stakeholders, including significant value
upside for its shareholders, and that its delivery offers a materially
superior opportunity than the proposal from Macquarie. The Board
therefore does not believe the Macquarie proposal to be in the interests
of Renewi’s shareholders, taken as a whole.
Accordingly, the Board strongly urges shareholders to take no action at
this time.
For the purposes of Rule 2.5(a) of the Code, this announcement has been
made without the consent of Macquarie.
In accordance with Rule 2.6(a) of the Code, Macquarie is required, by not
later than 5.00 p.m. on 26 October 2023 (being 28 days after today’s
date), to either announce a firm intention to make an offer for the
Company in accordance with Rule 2.7 of the Code or announce that it does
not intend to make an offer for the Company, in which case the
announcement will be treated as a statement to which Rule 2.8 of the Code
applies. This deadline can be extended with the consent of the Panel on
Takeovers and Mergers in accordance with Rule 2.6(c) of the Code.
For further information:
Greenhill, Financial Adviser
Dean Rodrigues, David Wyles, Charlie Stripp +44 20 7198 7400
Berenberg, Joint Corporate Broker
Toby Flaux, James Thompson, Milo Bonser +44 20 3207 7800
Peel Hunt, Joint Corporate Broker
Mike Bell, John Welch +44 20 7418 8900
Paternoster Communications, Financial PR Adviser
Tom Buchanan +44 20 3012 0241
Notes:
1. Conversion ratio target assumes elimination of legacy cash costs
related to UK Municipal business, COVID tax deferrals and shipment of
Mineralz & Water TGG coming to an end.
Disclaimer
Greenhill & Co. International LLP ("Greenhill") which is authorised and
regulated by the Financial Conduct Authority (“FCA”) in the United Kingdom
is acting exclusively for Renewi and no one else in connection with the
matters described herein and will not be responsible to anyone other than
Renewi for providing the protections afforded to clients of Greenhill or
for providing advice in connection with the matters described herein.
Neither Greenhill nor any of its subsidiaries, branches or affiliates owes
or accepts any duty, liability or responsibility whatsoever (whether
direct or indirect, whether in contract, in tort, under statute or
otherwise) to any person who is not a client of Greenhill in connection
with this announcement, any statement contained herein or otherwise.
Joh. Berenberg, Gossler & Co. KG, London Branch ("Berenberg"), which is
authorised and regulated by the German Federal Financial Supervisory
Authority ("BaFin") and is authorised and regulated by the FCA in the
United Kingdom, is acting exclusively for Renewi and no one else in
connection with the matters set out in this announcement and will not be
responsible to anyone other than Renewi for providing the protections
afforded to clients of Berenberg, or for providing advice in connection
with any matter referred to herein. Neither Berenberg nor any of its
affiliates owes or accepts any duty, liability or responsibility
whatsoever (whether direct or indirect, whether in contract, in tort,
under statute or otherwise) to any person who is not a client of Berenberg
in connection with this announcement, any statement contained herein or
otherwise.
Peel Hunt LLP ("Peel Hunt"), which is authorised and regulated in the
United Kingdom by the FCA, is acting exclusively for Renewi and for no-one
else in connection with the matters referred to in this announcement and
will not be responsible to any person other than Renewi for providing the
protections afforded to clients of Peel Hunt, nor for providing advice in
relation to the matters referred to herein. Neither Peel Hunt nor any of
its affiliates owes or accepts any duty, liability or responsibility
whatsoever (whether direct or indirect, whether in contract, in tort,
under statute or otherwise) to any person who is not a client of Peel Hunt
in connection with the matters referred to in this announcement, or
otherwise.
Important notice
This announcement is not intended to, and does not, constitute or form
part of any offer, invitation or solicitation of any offer to purchase,
otherwise acquire, subscribe for, sell or otherwise dispose of, any
securities or the solicitation of any vote or approval in any
jurisdiction, whether pursuant to this announcement or otherwise.
The release, distribution or publication of this announcement in
jurisdictions outside the United Kingdom or The Netherlands may be
restricted by laws of the relevant jurisdictions and therefore persons
into whose possession this announcement comes should inform themselves
about, and observe, any such restrictions. Any failure to comply with the
restrictions may constitute a violation of the securities law of any such
jurisdiction.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in 1% or more
of any class of relevant securities of an offeree company or of any
securities exchange offeror (being any offeror other than an offeror in
respect of which it has been announced that its offer is, or is likely to
be, solely in cash) must make an Opening Position Disclosure following the
commencement of the offer period and, if later, following the announcement
in which any securities exchange offeror is first identified. An Opening
Position Disclosure must contain details of the person’s interests and
short positions in, and rights to subscribe for, any relevant securities
of each of (i) the offeree company and (ii) any securities exchange
offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a)
applies must be made by no later than 3.30 pm (London time) on the 10th
business day following the commencement of the offer period and, if
appropriate, by no later than 3.30 pm (London time) on the 10th business
day following the announcement in which any securities exchange offeror is
first identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to the
deadline for making an Opening Position Disclosure must instead make a
Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested
in 1% or more of any class of relevant securities of the offeree company
or of any securities exchange offeror must make a Dealing Disclosure if
the person deals in any relevant securities of the offeree company or of
any securities exchange offeror. A Dealing Disclosure must contain details
of the dealing concerned and of the person’s interests and short positions
in, and rights to subscribe for, any relevant securities of each of (i)
the offeree company and (ii) any securities exchange offeror(s), save to
the extent that these details have previously been disclosed under Rule 8.
A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made
by no later than 3.30 pm (London time) on the business day following the
date of the relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a securities
exchange offeror, they will be deemed to be a single person for the
purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and
by any offeror and Dealing Disclosures must also be made by the offeree
company, by any offeror and by any persons acting in concert with any of
them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant
securities Opening Position Disclosures and Dealing Disclosures must be
made can be found in the Disclosure Table on the Takeover Panel’s website
at 1 http://www.thetakeoverpanel.org.uk, including details of the number
of relevant securities in issue, when the offer period commenced and when
any offeror was first identified. You should contact the Panel’s Market
Surveillance Unit on +44 (0)20 7638 0129 If you are in any doubt as to
whether you are required to make an Opening Position Disclosure or a
Dealing Disclosure.
Publication on Website
In accordance with Rule 26.1 of the Code, a copy of this announcement will
be made available at 2 https://www.renewi.com by no later than 12 noon
(London time) on the first business day after the date of this
announcement. The content of the website referred to above is not
incorporated into and does not form part of this announcement.
Rule 2.9 Disclosure
In accordance with Rule 2.9 of the Code, the Company confirms that as at
the date of this announcement, it has in issue 80,255,720 ordinary shares
of £1.00 each with ISIN number GB00BNR4T868.
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Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
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ISIN: GB00BNR4T868
Category Code: MSCM
TIDM: RWI
LEI Code: 213800CNEIDZBL17KU22
OAM Categories: 3.1. Additional regulated information required to be
disclosed under the laws of a Member State
Sequence No.: 274701
EQS News ID: 1737445
End of Announcement EQS News Service
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