Carlyle comes out in Shanks chase

US buy-out firm Carlyle today confirmed it had approached UK waste management group Shanks with a potential takeover offer.

The firm said it was “evaluating a possible cash offer” but did not specify the figure under discussion.

Earlier this month Shanks announced that it had received a 135p-a-share bid but said a cash offer of 150p, valuing the firm at £595m (€663m), would deliver “appropriate value”.

In a statement today Carlyle confirmed it was considering a bid for Shanks, but added that there was “no certainty” that an offer would be forthcoming.

Milton Keynes-based Shanks has been in discussions about the approach with its two largest shareholders, Legal & General and Schroders, which have said they favour a 150p-a-share offer.

A successful takeover would make Shanks the UK’s third waste management group to fall into private equity hands in recent years, following the buy-outs of rivals Cory and Biffa.

Shanks, which employs 4,500 staff, has three key areas of work – recycling, converting waste into energy and Private Finance Initiative (PFI) contracts.

The company was formed in the late 1880s as a construction company based in the west of Scotland.

It has UK offices in Lochgilphead in Argyll, Milton Keynes, Southampton, Pontypool, Rainham in Essex and Glasgow.

The firm raised £66.7m (€74m) in a rights issue in May, which it used to strengthen its balance sheet.

Carlyle has over 900 corporate and real estate investments across its global business.

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