Shanks completes sale of UK solid waste ops to Biffa
Waste management firm Shanks Group has confirmed that it has sold its UK solid waste business to rival firm Biffa for £9.5m.
The group’s solid waste business collects, sorts and processes commercial and industrial waste in the UK. The deal was first announced last year (October 2013) and has been completed following employee consultation and resolution of other routine regulatory clearances.
In a statement, Shanks said the completion of the deal represents its exit from UK solid waste operations “where Shanks is sub-scale and not positioned to win”.
The waste management firm also said that processes are underway to sell its Blochairn and Kettering materials recycling facilities (MRFs).
The company explained that the move is expected to generate net cash proceeds for Shanks of approximately £14m including working capital receipts, with £8m from the disposal assets and a further £6m from the sale of MRFs in Blochairn and Kettering. It is expected that Shanks will benefit from an additional cash inflow of approximately £3m following the acquisition.
Chief executive Peter Dilnot said: “These transactions deliver on our strategy of focusing on markets where we have sustainable competitive advantage and can generate attractive returns. We are exiting a market where we are sub-scale and not positioned to win, and focusing our UK operations on our growing UK municipal and organics businesses.
“Shanks is well positioned for future growth, with a portfolio of strong businesses in attractive target markets. In addition to our growing UK municipal business, we are market leaders in Benelux Solid Waste, have a differentiated business in European Hazardous Waste, and an established leadership position in organics.
“The combination of these businesses provides a strong platform for delivering profitable growth and generating attractive returns.”