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Merger proposed for Interserve and Mitie

25 June 2020

Today saw the announcement for the proposed joining of Interserve Support Services with Mitie, subject to the approval of the Competition Markets Authority (CMA) and the latter's shareholders.

The deal has been valued at £271m, comprised of £120m in cash and a 23.4% stake in the Mitie business by Interserve shareholders.

If approved, the deal will see the Interserve public and private FM operations in the UK and overseas transfer to Mitie and is expected to be completed by the end of the year.

This morning's announcement stated that the transaction would create an enterprise employing more than 77,500 people, although no mention was made of whether redundancies in either operation were likely following the impact of the Covid-19 lockdown.

Following the transfer of its Support Services division to Mitie, Interserve Group will continue to operate its three remaining divisions, namely Construction, Equipment Services (RMD Kwikform) and Citizen Services.

The group will continue to be led by chair Alan Lovell and executive director and chief financial officer Mark Morris.

Mr Lovell said the deal "will create the UK's leading FM company, with strong prospects in both the public and private sectors providing significant opportunities to employees, customers and shareholders alike".

The announcement further stated that Lazard is acting as sole financial advisor to Interserve, with Slaughter and May acting as legal counsel.

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