Mitie to buy Interserve FM business for £271m

The takeover will create the UK’s largest FM business, employing 77,500 staff in both hard and soft FM services.

Under the deal agreed by both company boards, Interserve will receive £120m in cash and a 23.4% shareholding in Mitie.

The proposed take-over needs to be ratified by Mitie’s shareholders and is expected to complete by the end of this year.

Last year Interserve Facilities Management achieved revenue of £1.4bn, generating operating profits of £43m.

Mitie, which presently employs 37,500 staff, this morning posted operating profits of £86m from £2.2bn turnover in the year to March.

Following the completion of the transaction, Interserve Group will continue to focus on delivering its business plans for its three remaining divisions: Interserve Construction, RMD Kwikform, as well as its Citizen Services portfolio of businesses.

Also Mitie this morning announced plans for a £200m right issue and extension of a £250m banking facility until the end of 2022 to put it on a stable financial footing.

Around £80m will be used to part-fund the Interserve acquisition.

Alan Lovell will continue to lead Interserve Group as chairman, supported by Mark Morris, chief financial officer.

updated: 25/06/2020