Global investment firm KKR completed its £4.2 billion acquisition of waste firm Viridor from Pennon Group today (8 July).
Phil Piddington, who has been Viridor’s managing director since 2016, assumes the role of the company’s chief executive officer. He said KKR had recognised the strategic value of Viridor’s UK recycling and residual waste management platform and growth opportunities.
KKR’s head of European infrastructure Tara Courtney Davies said: “We see enormous potential for Viridor as a standalone business.
“The company is already a sector leader with a strong platform and an experienced management team.
“With KKR’s support, Viridor is uniquely positioned to invest further and continue to build critical infrastructure, helping the UK meet long-term sustainability and environmental goals.”
Pennon Group, which also owns South West Water, announced in March that Planets UK Bidco, a newly formed company, would be buying its waste arm for £4.2 billion (see letsrecycle.com story). The company was established with funds advised by KKR.
The imminent completion of the sale was revealed exclusively by letsrecycle.com yesterday (see letsrecycle.com story).
In a surprise move, Viridor also announced the appointment of Ian Wakelin, former chief executive officer of Biffa plc, as chairman of the company. He says he is excited by his return to the sector.
“Viridor is clearly well-positioned to continue to deliver excellent growth”
Mr Wakelin said: “Viridor is clearly well-positioned to continue to deliver excellent growth and this is enhanced by the investment from KKR, a group which values infrastructure development.
“Viridor has a clear strategy based on market demand and a real understanding of the challenges and opportunities in this sector based on years of experience.
“I look forward to working with the Viridor management team over the coming years to deliver their vision for the company.”
Mr Piddington says Viridor will continue to advance its plans for future growth with infrastructure investments backed by long-term contracts.
He said: “We are exploring options for three more energy recovery facilities, including a new plant at Ford in West Sussex, another joint venture with Grundon Waste Management.
“This supports market demand for landfill-diversion facilities which produce low carbon heat and power and contribute to UK resource and energy efficiency.
“As a complete waste and resource management company working across the UK, we are keenly aware of exactly where the capacity gap exists.
“We are confident that we are best placed to deliver the environmental ambitions of the UK and its devolved administrations, especially where these focus on green recovery, jobs, innovation and infrastructure.”
Grundon and Viridor submitted a planning application to West Sussex county council for an energy from waste (EfW) facility and a transfer station with a combined capacity of 295,000 tonnes per annum at Ford in late June (see letsrecycle.com story) .
Pennon Group said it was “pleased” to announce the sale had been completed. It said the cash proceeds it received were £3.7 billion after taking into account debt and debt-like items that remained with Viridor and customary transaction costs.
The company said it would now focus on its water and wastewater businesses, whilst considering further growth opportunities that would create value for customers, employees and shareholders.