Mitie Group (LSE:MTO) has agreed to a recommended cash acquisition by OCS Group International in a deal valuing the company at up to 221.6 pence per share, including its proposed final dividend. The offer values Mitie’s equity at approximately £3.1 billion and represents a premium of more than 40% to recent trading levels. Mitie’s board has unanimously recommended the transaction, while directors and a major shareholder have provided irrevocable undertakings to vote in favour of the deal.
The acquisition will be completed through a Scottish court-sanctioned scheme of arrangement, subject to shareholder approval and regulatory clearances. Once completed, the combined business is expected to generate approximately £8.5 billion in annual revenue, creating one of the UK’s largest facilities services providers. Management believes the enlarged group will be better positioned to compete with global rivals, broaden its sector expertise and geographic reach, increase investment in technology and operations, and expand career opportunities for employees.
Alongside the acquisition announcement, Mitie reported a strong start to FY27, with first-quarter revenue increasing 10% to £1.41 billion. Organic revenue grew 4%, supported by contributions from the Marlowe acquisition, while total contract wins and renewals reached £1.6 billion. The company’s bidding pipeline also expanded to a record £32.5 billion, with customer retention improving to 91%, providing greater visibility over future revenue.
Business Services delivered particularly strong growth, with revenue rising 23% following major contract wins in security and hygiene services, as well as a strong performance in Spain. Technical Services revenue declined 5%, although management said sales momentum had improved under new leadership. Integration of Marlowe continues to progress ahead of plan, delivering cost synergies, office consolidation and a significant expansion of cross-selling opportunities to approximately £700 million in annual contract value.
Mitie is also investing in artificial intelligence through its Process Reimagination and Optimisation programme, which applies agentic AI across areas including workforce management, recruitment, cleaning and security services to improve efficiency and support future margin growth. The company maintained its BBB investment-grade credit rating, continued its £100 million share buyback programme and ended the quarter with net debt of £477 million, reflecting seasonal working capital movements and acquisition-related borrowing. Management said improving free cash flow supports confidence in delivering its FY25–FY27 strategic objectives.
While Mitie’s outlook remains supported by steady revenue growth, strong cash generation and a healthy pipeline of new business, investors continue to monitor higher leverage and pressure on profitability. Technical indicators remain relatively weak, although the company’s valuation continues to be supported by a moderate earnings multiple and dividend yield.
About Mitie Group plc
Mitie Group plc is a UK-based facilities management company providing services across government, defence, healthcare, critical infrastructure and commercial sectors. The group specialises in managing complex built environments through a combination of facilities management, engineering expertise, digital technologies and artificial intelligence.
OCS Group International is also a UK-headquartered facilities services provider with experience integrating acquisitions and expanding across multiple sectors and international markets. The proposed combination of OCS and Mitie is expected to create one of the UK’s largest private-sector employers, offering services across a broad range of industries while investing in technology, workforce development and operational excellence.
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