Cory Environmental Group has sold its municipal waste and recycling collection business to Biffa for an enterprise value of £23m, delivered as consideration of £13.5m and an additional cash release to Cory of £1.8m.
The sale is a result of a strategic review launched by Cory’s board, which concluded that the Cory Environmental Municipal Services (CEMS) Limited was no longer “core” to Cory and that the long term future of the business would therefore best be secured under new ownership.
Cory revealed there was a high level of interest from bidders. It said Biffa has extensive experience in the sector with a large portfolio of collection contracts that align well with the CEMS geographic footprint and services.
Cory – “Biffa are a natural owner for CEMS and we wish the business every success for the future.”
Nicholas Pollard, Cory’s Group CEO commented: “This transaction follows directly from our strategic review.
“It will simplify our Group structure, enabling us to invest substantially and develop our core business of providing and operating infrastructure for waste management, materials recycling, waste disposal and energy generation – in particular at our Riverside facility, one of the UK’s largest, cleanest and most efficient Energy from Waste plants.
“Biffa are a natural owner for CEMS and we wish the business every success for the future.”
Cory Environmental Group (“Cory”) is currently majority owned by funds advised or managed by Strategic Value Partners LLC or its affiliates.
The business is well known and recognisable for its trademark Riverside infrastructure, comprising a large fleet of tugs and barges which sustainably transport over 500,000 tonnes of London’s municipal and commercial waste every year to their energy from waste (EfW) facility, producing electricity and recycled construction materials directly from the waste stream.
For the year ended 31 December 2015 CEMS reported total revenues of c. £34m. The business employs c. 800 people.
Biffa – “This transaction provides further proof that Biffa is a natural consolidator in the industry, with the technology, scale, reputation and expertise to grow and build upon our market leading positions in the UK”
Biffa will take on four major Local Authority contracts providing waste and recycling collection services in Cornwall, Lincoln, Rutland and Tunbridge Wells. The Cornwall contract is one of the largest outsourced contracts in the UK covering street and beach cleansing as well as household waste and recycling services.
Biffa will also take over the provision of commercial waste collection and recycling services to an anticipated customer base of approximately 7,000, predominately in the South West and South East, offering compaction, exchange, confidential waste collection and other related specialist services.
Ian Wakelin, Chief Executive of Biffa, said: “This is an important acquisition for us. We believe that it will significantly strengthen our positions in the UK I&C and Municipal market segments, in which we already hold the number one and number two positions respectively.
“This transaction provides further proof that Biffa is a natural consolidator in the industry, with the technology, scale, reputation and expertise to grow and build upon our market leading positions in the UK.
“We are delighted to welcome CEMS to Biffa.”