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Biffa flotation 'worth £1bn'

Biffa could be valued at up to £1bn when it floats on the London Stock Exchange next year, the FT has reported.

The newspaper said the move would follow a “wave of consolidation” in the industry, fuelled by new technologies.

Biffa chief executive Ian Wakelin, above, has told the FT that the planned flotation would provide capital to invest in new plants and to expand internationally. This will initially be in Mexico, where the company is in advanced talks to open its first landfill gas site.

“The regulations are getting tougher and it takes tens of millions of pounds to invest in recycling infrastructure,” he said. “That makes it harder for smaller companies to play a part and will lend itself to consolidation.”

Biffa has completed eight acquisitions so far in 2015, according to the report.

It said Biffa had revenues of £916m and an ebitda of more than £102m during the period, representing earnings growth of about a third during the past two years.

The company said it expects the UK’s privatised recycling and waste collection market, currently 50%, to expand as the Government’s austerity measures drive greater outsourcing of such services.

Sky News reported in May that Rothschild bank was preparing the company for an initial public offering slated for spring 2016.

Biffa was taken over by four creditors in 2013, who swapped debt for equity and injected £75m into the firm as part of a recapitalisation deal, writing off around half of Biffa’s £1bn debt.

These shareholders included investors Angelo Gordon & Co, Avenue Capital Group, Babson Capital Europe and Sankaty Advisors.

It was previously bought by Montagu and Global Infrastructure Partners in 2008 after being owned by Severn Trent since 1991.

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