Shanks consigns Carlyle bid to the bin

SHANKS said yesterday it had walked away from takeover talks after rejecting an offer proposal valuing it at £475million.

The long-running discussions with US private-equity firm Carlyle collapsed after the company reduced its indicative price to 120p a share, from the 135p a share, or £535.6million, proposed in October.

The lower price comes a month after the waste-disposal group told shareholders that it expected full-year trading results to be slightly below its expectations. Shanks had earlier valued itself at 150p a share, or £595million.

Shares in Shanks slumped 15% to 102.2p following yesterday’s news.

A successful takeover would have made Shanks the UK’s third waste-management group to fall into private-equity hands in recent years, following the buyouts 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 – which has UK offices at Lochgilphead, Milton Keynes, Southampton, Pontypool, Rainham in London and Glasgow – was formed in the late 1880s.