Mitie agrees £3.1bn takeover by OCS, leaving London stock market

Mitie, a major UK government contractor, has agreed to a £3.1 billion takeover by private-equity owned rival OCS Group, marking another blow to the London stock market as a long-standing listed company prepares to leave the exchange. The deal ends Mitie's nearly four decades of public trading.

The acquisition affects Mitie's shareholders, who are recommended by the board to accept the cash offer of 221.6 pence per share. This represents a 44.7% premium over Monday's closing price, providing a significant return for investors. The company's employees and government clients, including various public sector contracts, will also be impacted as the firm transitions to private ownership.

This matters because it continues a trend of UK-listed companies being taken private, reducing the size and diversity of the London stock market. Mitie's departure follows other recent acquisitions, raising concerns about the attractiveness of UK public markets for long-term investment. The premium offered highlights the value private equity sees in the outsourcing sector.

The offer was announced on Tuesday, with the Mitie board unanimously recommending acceptance. OCS Group, a rival outsourcer owned by private equity, is funding the deal in cash. Specific numbers include the £3.1 billion total valuation and the 221.6p per share price.

Mitie has been listed on the London Stock Exchange for nearly 40 years, providing services such as facilities management, security, and cleaning to government and corporate clients. The company has faced challenges in recent years, including profit warnings and restructuring, but remains a key player in the outsourcing industry.

Next steps involve shareholders voting on the offer at a general meeting. If approved, the deal is expected to complete later this year, after which Mitie will be delisted from the London Stock Exchange. OCS plans to integrate Mitie into its operations, potentially leading to cost savings and expanded service offerings.