The mooted takeover of waste management firm Biffa by its creditors is thought to be one of several options currently being considered for the company.
A report in The Sunday Times yesterday (September 30) suggested that HSBC was close to leading a takeover of Biffa, alongside a number of the firms other creditors.
However an offer for the waste services giant, which collects around four million tonnes of waste per year, tabled by a consortium involving energy from waste firm Chinook Urban Mining earlier this year, is still thought to be under consideration.
The breakup and sale of Biffas individual recycling and waste collection concerns is also understood to be among the options being looked at. The companys waste activities include energy from waste facilities, plastics recycling and organics recycling.
Sale
The owners of the Buckinghamshire-based company have been looking since early 2012 to sell the firm, which has been struggling financially since its takeover by an investment consortium for 1.2 billion in 2008.
Biffas private equity owners, Montagu and Global Infrastructure Partners (GIP), each own 50% of the equity in the Biffa Group, but this was written down to zero last year and they have been under pressure to pay back 1.1 billion in loans.
A spokeswoman for Biffa said that the company was working closely with its lenders as part of the sale process but the reports that the firms creditors were close to a takeover could not be confirmed. HSBC declined to comment.
The Biffa spokeswoman said: Biffa is a profitable, cash generative business which is performing in line with its plans. The company is undertaking a well-managed, planned restructuring process, working closely with its lenders.”
Chinook
In August it was reported that Chinook Urban Mining, a subsidiary of US gasification specialist Chinook Sciences, in a consortium alongside private equity firm Clearbrook Capital Partners LLP had made a 520 million cash offer to purchase the company (see letsrecycle.com story). Chinook could not be reached for comment.
The sale of Biffa to Montagu and GIP was followed by the companys 135 million takeover of Greenstar UK in 2010 (see letsrecycle.com story).
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However, Biffa has suffered as a result of the financial downturn and in the companys 2011/12 Mid Year report, published in December 2011, chief executive Ian Wakelin acknowledged that it was experiencing economically difficult and challenging times with no discernible sign of improvement.
Biffa currently operates waste and recycling services for over 40 local authorities in the UK.
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