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Private equity focuses on EfW

At the beginning of the week we heard that Waterland Private Equity, the Dutch independent investment group had successfully acquired the energy-from-waste (EfW) operator Attero for €170m (£143m).

This is Waterland’s first investment in the waste industry and is notable because they succeeded ahead of strategic players such as SITA and Indaver who were known to be interested in an acquisition.

Waterland was founded in 1999 and it is interesting to see how a largely mid-market focused buy-out fund has now invested in a significantly larger business with revenues of £274m, that has a focus on infrastructure and power.

They were not the only private equity firm in the process – Cerberus and Gilde were also understood to have made offers – which shows the attraction of this type of investment to financial investors.

Also this week we heard that a new £48m EfW plant will be built in Birmingham with backing from the Green Investment Bank (GIB). The plant will use Nexterra Systems gasification technology which utilises recovered wood and will produce 10.3MW of electrical power.

The plant is scheduled to be operational in early 2016 and will process 67,000 tonnes of recovered wood and produce enough electricity to supply more than 17,000 houses in its 20-year lifetime.

The venture to be known as Birmingham Bio Power Ltd has attracted a consortium of investors in addition to GIB including Foresight Group, Balfour Beatty, Eternity Capital Management, GCP Infrastructure Fund and developer Carbonarius (part of the UNA Group).

This is the first investment for Eternity Capital which focuses on investments in waste management and environmental services across the UK and Europe.

As many in the industry will appreciate, this is a very positive backing of gasification technology and as Shaun Kingsbury of GIB said it will “offer a positive demonstration effect that others will follow”. We expect significant ramping of investment in gasification over the next ten years, potentially led by private equity.

Mark Wilson, partner with Catalyst Corporate Finance

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