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On Tuesday, RBC Capital analysts revised their rating on Marlowe Plc (MRL:LN), downgrading the company from Outperform to Sector Perform. The firm also increased its price target for Marlowe shares from GBP4.50 to GBP4.66. This adjustment comes in light of the recent takeover offer made by Mitie, which RBC Capital believes is a compelling proposition for Marlowe’s shareholders.
The proposed acquisition by Mitie is valued at an equity value of £366 million, translating to a multiple of approximately 14.4 times the calendar year 2025 estimated enterprise value to adjusted cash EBITDA. According to RBC Capital, this offer would provide Marlowe’s shareholders with an approximate 26.5% implied return relative to the share price prior to the announcement. Additionally, it would allow shareholders to benefit from the long-term potential of the combined entity.
The analysts at RBC Capital anticipate that Marlowe’s shareholders will likely vote in favor of the takeover in the coming months, with a positive outcome expected around July or August. The closure of the deal is targeted for the third quarter of 2025. The revised price target of GBP4.66 aligns with the takeover offer, leading to the new Sector Perform rating.
RBC Capital’s commentary on the matter highlighted the strategic fit of Marlowe within Mitie’s business model and growth plan. The firm’s analysts are optimistic about the integration of Marlowe into Mitie and the potential benefits for stakeholders of both companies.
The market will be closely watching the developments surrounding the potential acquisition, as shareholder approval and the subsequent integration of Marlowe into Mitie’s operations could influence the performance of both companies’ stocks in the near future.
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