6 July 2018 by Elizabeth Slow

Lidl to acquire German waste business

The Schwarz Group, parent company of retailer Lidl, is to acquire German waste disposal company, Tönsmeier Group.

The acquisition via GreenCycle – a subsidiary of German retail giant Schwarz – is designed to expand the firm’s “range of services in the environmental service branch while strengthening its internationalisation”.

Retail giant Schwarz Gruppe – the parent company which owns Lidl – is acquiring German waste business, Tönsmeier Group (Shutterstock)

‘Game changer’

Lidl’s expansion in the waste sector has raised eyebrows among waste companies. One German waste sector expert told letsrecycle.com: “This is a big market step and something of a game changer in that a retailer is buying a business within the waste sector.”

The transaction for Tönsmeier, which reports to be Germany’s fifth largest waste management company, is still subject to approvals, including by competition regulator, Antitrust Authority.

The sale was preceded by a structured process initiated by the Tönsmeier family in early 2018. The process involved discussions with a number of strategic interested parties and financial investors, the company said.

GreenCycle provides waste disposal and recycling services for the companies of the Schwarz Gruppe. GreenCycle’s responsibilities include collecting and recycling materials generated in the stores and logistics operations of the Lidl and Kaufland retail divisions.

Besides its activities for the Schwarz Gruppe, GreenCycle has also acted as a waste disposal service provider for other companies for several years.

UK business

In terms of the UK business – which equates to around 700 stores – Lidl’s mixed waste is collected and processed by a range of waste management partners.

After recycling is separate, the remaining waste is sent for incineration and a small fraction sent to landfill, according to the retailer’s 2016/17 sustainability report.

In 2016/17, 86% mixed waste was either recycled or recovered, the report notes. This includes around 85,000 tonnes of cardboard and plastic recovered each year, as reported in 2016/17.

Waste partners are understood to include Hartlepool-headquartered J&B Recycling which provides regional services to the retailer (see letsrecycle.com story), while Viridor has a contract to provide general, wood, plastic and hazardous waste services to the £55 million Lidl Exeter Distribution Centre (see letsrecycle.com story).

Growth

“GreenCycle pursues a clear growth strategy, aiming to establish itself in the market as a driver of the environmental service branch with sustainable innovations.”


Dietmar Böhm
GreenCycle

Commenting on the acquisition, Dietmar Böhm, managing director of GreenCycle GmbH, said: “GreenCycle pursues a clear growth strategy, aiming to establish itself in the market as a driver of the environmental service branch with sustainable innovations.

“This acquisition expands GreenCycle’s customer segment, and the company intends to use the services and solutions of the Tönsmeier Group to tighten cycle systems and promote recycling and recyclability.”

Tönsmeier

Environmental services provider, Tönsmeier, reports to have more than 3,000 employees across 70 locations in Germany and Poland.

Jürgen Tönsmeier, chairman of the supervisory board of the Tönsmeier Group, added: “Our primary goal has been to find a financially strong new owner with strategic growth plans for continuing the Tönsmeier Group’s development. We have achieved that goal with GreenCycle, whose offer we found the most convincing.

“Although GreenCycle is one of the largest trading companies in the world as part of the Schwarz Group, it is also a family-run company that thinks long-term and acts sustainably.”


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