Pennon Group Acquisition of Community Waste Holding & Recycling
Pennon Group expands its Waste Management business
Pennon Group Plc announces that its subsidiary, Viridor Waste Management Limited, has acquired Community Waste Holding Limited and Community Waste Recycling Limited, a specialist materials recycling and paper trading business based in Milton Keynes, from Community Waste Holdings Foundation, Ms C Cutts and Ms G Cutts. The total consideration on a debt-free basis was £15.75m (comprising cash of £8.775m and Pennon Group Plc loan notes totalling £6.975m). The acquisition is in line with the Group's strategy of expanding its waste management activities, particularly in the recycling sector.
The acquired business operates in the south east of England. It has a number of medium and long-term municipal contracts and a total current annual volume of 90,000 tonnes. Its main operations are: a Materials Recycling Facility (MRF) in Milton Keynes, Bedfordshire, processing co-mingled dry recyclables; an MRF in Enstone (northwest of Oxford) processing municipal and commercial recyclables; and a trading arm located in London.
Commenting on the acquisition, Colin Drummond, Chief Executive of Viridor said, "The UK's waste strategy demands ever increasing levels of recycling whilst the world has an increasing demand for raw materials including recyclate. Recycling is a fast growing part of Viridor's business and accounted for around 31% of the Company's profit contribution in the first half of financial year 2011/12. Community Waste's operations in Bedfordshire and Oxfordshire fit well with our existing operations and strategy in the south east, and also provide additional volumes for our international trading arm. The acquisition is expected to be earnings enhancing in its first full year."