Cory Environmental set for £500m sale

The company’s parent company, Montagu Private Equity, confirmed today that it has asked Deutsche Bank to arrange a sale of the company.

Cory Environmental is well-known for its river-based waste transport system on the Thames, but also runs eight landfill sites and various municipal collection contracts

Information on Cory has been sent out to interested parties, and that there are now hopes that an acquisition could be achieved early next year.

Speaking to letsrecycle.com, a spokesman for Deutsche Bank revealed that it was “more likely” that Cory would be acquired by another waste management firm than a private equity investor.

However, a Montagu spokesman said that the fund was expecting interest from private equity businesses and infrastructure funds as well as trade investors.

Montagu, which bought Cory for £200 million in 2005 (see letsrecycle.com story), insisted that buying, growing and selling companies within one or two years was normal for a private equity company such as itself.

Commenting on the sale, the Montagu spokesman said: “Cory has an extremely successful management team and is a very good business with good growth prospects. The sale is quite a long process but we are expecting to sell by around Spring next year.”

Interest
Although Cory Environmental itself has declined to comment on the sale, the Deutsche Bank spokesman explained that a final valuation of the company was yet to be carried out.

Once the valuation is made – expected to be in the region of a nine-figure sum – Deutsche Bank will help Montague decide on which bid for the company should prove the most advantageous to shareholders.

The bank spokesman said: “The company may be looking at several options and a sale may only be one of them. However, it looks in the press like a sale is going ahead and people are expecting it to raise about 500 million.”

He added: “I think it is more likely to be bought by a waste management firm than another private equity company.”

“Excellent”
Montagu has explained that its original investment in Cory last year was made because of the company’s contracted revenue, well-placed landfill sites and experienced management.

The company won a £700 million contract in 2002 to manage all the waste generated by households in the Western Riverside Waste Authority are of London (see letsrecycle.com story).

As part of that contract, any successful buyer of Cory would find itself with the keys to what is set to become Britain’s largest energy-from-waste incineration plant, the 200m facility being developed at Belvedere, in South-East London (see letsrecycle.com story).

As a waste firm, Cory is also well-known for its award-winning river transport network in London, in which it transports some 20% of London’s waste down the Thames.

Outside the capital, the company provides municipal waste collection, recycling and street cleansing services in Carrick in Cornwall, East Northamptonshire, Lincoln city, Milton Keynes, Southend-on-Sea and Rutland.

The company has eight operational landfill sites including three in Essex, two in Gloucestershire, two in the West Midlands and one on Merseyside. Cory also manages a number of transfer stations and recycling centres.

Describing the company, Montagu said: “Cory has an excellent record of revenue and profit growth, is well invested and has a strong position in its markets.”