A consortium of investment managers Ancala Partners and Fiera Infrastructure have swooped in on waste management firm Augean, raising the prospect of a bidding war for the AIM-listed company.
In a statement this morning Augean said that it had agreed to the two firms’ 325p per share, £341m buyout offer, having earlier this month approved a 300p per share offer from Morgan Stanley Infrastructure.
Shares in the firm jumped 16.8 per cent to 333p after the deal was announced overnight.
The firm’s board said that the superior price was “compelling” and urged its shareholders to take no action in relation to Morgan Stanley Infrastructure’s offer.
To complete the deal the two firms have created a special purpose acquisition company, or SPAC.
Both Ancala and Fiera are long-term investors in the waste management sector. Karen Dolonec, a partner at the former, said:
“Augean provides essential and responsible hazardous waste management services to key private and governmental infrastructure operators.
“Ancala has been impressed by the high quality of the team and operations and is excited to support the Company in expanding its role in this critical part of an effective waste management ecosystem.”
Augean, which was founded in 2004, offers waste management services to companies in a range of sectors including oil, gas, and the nuclear industries.
Executive chairman Jim Meredith said: “The Augean Board believes that Ancala and Fiera Infrastructure are well-respected as long-term investors in the infrastructure sector and will be able to support Augean’s strategy of providing the highest level of customer service and safe operations in niche and highly regulated hazardous waste markets.
“We recognise the increase in the price offered to Augean Shareholders under the Offer when compared with the MSIP Offer and have accordingly recommended the Offer to Augean Shareholders.
“As Ancala and Fiera Infrastructure intend to maintain the same strategy and footprint, we also believe that the acquisition is a good outcome for all Augean stakeholders, including our employees, our customers and the wider UK economy.”
AJ Bell’s Danni Hewson said that the offer showed that there was no sign of the “feeding frenzy” on London-listed firms letting up.
“This continuing global corporate raid suggests bidders still see a lot of untapped value in the UK market”, she said.
“The danger is that if it doesn’t let up soon London will be left looking like a bit of wasteland for stocks.”