Just over 805mln new shares were admitted from the £201mln rights issue to fund the £271mln cash-and-shares acquisition.
The rights issue will dilute earnings per share by an estimated 51% in the 2021 financial year and 62% in 2022, said broker Liberum in a note on Tuesday, but will significantly reduce the debt burden, while the Interserve acquisition will be 27% accretive.
Combining the two businesses creates “a market leader in technical, security and cleaning services”, analyst Joe Brent said in a note to clients.
“Mitie’s exposure to the public sector will also increase, leading to a more balanced business.”
However, he said the valuation was “still not attractive” so resumed coverage with a ‘hold’ recommendation.
The shares tumbled 45% after the rights issue shares were admitted to 46.95p by mid-morning.