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(Adds details on financing, background, share move)
Sept 23 (Reuters) - Investment manager Ancala Partners outbid Morgan Stanley Infrastructure (MSI) in a rare auction to buy Augean for 390 million pounds ($532 million), ending a month-long takeover battle for the UK-based waste management firm.
London-based Ancala's sweetened 372 pence-per-share offer topped MSI's bid of 361 pence per share on the single-day auction on Wednesday evening, the British takeover panel said.
Ancala said Augean backed its offer and would recommend it to its shareholders. Augean's shares were trading 1% higher in early trade.
Buyout groups have circled British companies with multi-billion deals as takeovers for UK companies hit a 14-year high by value in the first seven months of 2021, driven by cheaper valuations due in part to the pandemic and Brexit.
Head-to-head auctions are initiated by the takeover regulator if two competing bids that have not been declared final remain on the table for the company at the end of the offer period and only a handful of bidding wars have slipped into an auction process in recent years.
The deal for Augean will be funded by a combination of equity and debt. Ancala is part of a special purpose vehicle, Eleia Ltd, which was formed with Fiera Infrastructure for the acquisition. ($1 = 0.7334 pounds)
(Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Subhranshu Sahu and Arun Koyyur)