KKR’s Viridor to start sale of recycling unit: sources

By Clara Denina and Arno Schuetze

LONDON/FRANKFURT (Reuters) – Viridor, the British waste management business owned by U.S. private equity firm KKR, has hired investment bank UBS to sell its waste and recycling subsidiary, two sources told Reuters.

Viridor, bought by KKR from British water utility Pennon for 4.2 billion pounds ($5.4 billion) in March, is looking to simplify its portfolio and will sound out market interest in the next few weeks, the sources said.

The recycling unit has an EBITDA (earnings before interest, taxes, depreciation and amortization) of about 75 million pounds, they added.

Viridor and Swiss bank UBS declined to comment.

KKR did not immediately respond to a request for comment.

As public pressure mounts to pare back on global waste, including the plastic packaging clogging landfills and oceans, companies around the world have committed to improve recycling and reduce their carbon emissions, boosting their credentials with investors and the general public.

Viridor’s waste and recycling subsidiary could attract the interest of private equity and infrastructure funds keen to capitalise on the steady returns from a business that often works with underlying contracts, which are consistently renewed.

Macquarie Infrastructure Partners has separately launched the sale of waste management company Wheelabrator’s power plants in the United Kingdom, with initial bids expected in coming days, sources told Reuters in August.

($1 = 0.7726 pounds)

(Reporting by Clara Denina and Arno Schuetze; Editing by Pravin Char)