The global credit crunch has not subdued the desire of international infrastructure investment funds to buy waste sector assets, according to a report from business adviser Deloitte. Researchers said that large infrastructure funds, which are capable of raising €2billion in capital, are very interested in waste management company assets.
Deloitte infrastructure funds partner James Riddell said: [Funds] are keen on the opportunities that they see as coming up in the UK and Western Europe.
While airports, regulated utilities and roads are still the primary focus for investments, Riddell explained: The research suggests that those funds prepared to move outside their comfort zone, whether its tangential infrastructure assets, greenfield infrastructure investments, or in geographies with greater sovereign risk, may be able to grab a bargain before the rest of the pack catches up.
A second Deloitte infrastructure funds partner David Scott added: The research also shows that less traditional assets such as waste, renewables and telecommunications infrastructure look set to benefit form funds investment in the next two years.
Technologies under investors spotlights include energy from waste, anaerobic digestion and mechanical biological treatment.
While the reports findings were not a surprise to Riddell he explained that it was interesting that despite the current credit crunch, these companies are still open for business, and can raise debts to buy assets while other funds cannot.
He added: [Funds] have also been looking at things that may not be considered infrastructure, for example landfill and collection services. The feeling is if they are already diversifying into this sector then the risk is not increased if they go into collection.
[Funds] will look at opportunities deal by deal, for example if private companies were to come up for sale, companies in the same league as Biffa and Veolia Environmental Services, then there would be interest in buying them.