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Goldman Sachs invests in recycling

An £8 million cash injection from investors that include US investment bank Goldman Sachs will enable a company to add 400,000 tonnes to its annual processing capacity.

After completing a further round of equity financing, Sterecycle has announced how the funding along with debt facilities will enable it to build a further four specialist waste management plants.

The company has developed a process which converts household waste into a multiple use biomass substance and is due to open its first UK facility in early 2007.

Now, thanks to the funding, further plants will each be capable of processing 100,000 tonnes a year and have the ability to deal with the household waste created by a town of 200,000 people.
The company is also at an advanced stage of negotiations to install facilities for several local authorities.

Sterecycle chief executive Duncan Grierson said: With the support of such a well-respected shareholder as Goldman Sachs we will be able to grow much faster and take full advantage of the considerable market opportunities.

The market for waste recycling solutions is growing rapidly, and ever-tougher environmental legislation such as the Landfill Directive will see demand for our recycling services increase further. We are working on several projects around the UK and with additional debt financing we now have access to over £40 million of capital.

Using a steam treatment and mechanical sorting, 80% of household waste is recycled, with non-organics such as metals and plastics also cleaned for reuse.

The Sterecycle biomass can then be used as a green renewable energy source, as a soil conditioner for land remediation and even in the manufacture of fibre-board products.

Goldman Sachs International managing director Simon Mansfield said: We are delighted to announce this investment in Sterecycle. The business has done a great job in building a technology platform to provide solutions to solve the waste management problems in the UK.

With an impressive management team and significant additional capital on its balance sheet, we believe Sterecycle is extremely well positioned to develop its market share in the UK.

In a further development from the financing round, Goldman Sachs executive director Michael Linse has joined the board of Sterecycle.

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