Mitie has reduced the terms of its acquisition of outsourcing rival Interserve’s facilities management arm by over £80m, the firm announced this morning.
When the deal was announced back in June, it was set to cost Mitie £271m, but the firm will now issue 110m fewer shares to finance the deal.
As a result, it will now issue 248m shares, while the cash consideration element of the deal remains unchanged at £120m.
The merger, which will make Mitie the country’s largest facilities manager with 80,000 employees, will now cost £190m, it confirmed.
Shareholders will now own 82.5 per cent of the enlarged company.
Traders welcomed the announcement, with shares in the London-listed firm up 6.5 per cent by the mid-morning.
Chief executive Phil Bentley said: “Mitie, in particular, has been successful at renewing strategic contracts and winning new business during this period.
“Recognising this momentum, we have renegotiated the terms of the Interserve Facilities Management transaction.”
The firm also provided an impromptu trading update in which it revealed that revenue was up 12 per cent compared to the prior quarter.
It added that it had seen improvements in sales across cleaning, security and fixed technical services contracts.
Mitie said that revenue stood £972m, which was 9.8 per cent lower than the same period in the prior year.