Shanks share price rises amid further sale talks

The price continued to rise following mainstream media reports over the weekend linking a host of companies to the Milton Keynes firm, including American energy-from-waste specialist Covanta Energy, the parent company of waste and recycling firm SITA UK and Dutch energy-from-waste specialists AVR van Gansewinkel.

Interest was sparked following an “unsolicited” approach of 135 pence per share for the firm by American private equity investment firm Carlyle Group at the beginning of last week (see letsrecycle.com story).

Shanks confirmed later (December 8) that its two largest shareholders, Schroders Investment and Legal & General Investment, had agreed with the Board that a cash offer of 150 pence per share or more would indicate appropriate value and “indicated a willingness to support an offer at this level”.

However, with regards to the latest reports, a spokesman for Shanks told letsrecycle.com today that it refused to comment on what it called “market speculation”.

Suitors

At the forefront of the companies reported to be in pursuit of Shanks is Covanta Energy, which has been active in its pursuit of long-term waste contracts in the UK since entering the market in 2004.

To date the firm has won a 25-year energy-from-waste treatment contract with Buckinghamshire in September (see letsrecycle.com story) and has been shortlisted as one of two remaining bidders for the multi-million pound Merseyside PFI contract with SITA UK (see letsrecycle.com story).

However, speaking to letsrecycle.com today, Covanta distanced itself from a potential move for Shanks.

Malcolm Chilton, managing director of Covanta, said: “I can confirm that Covanta Energy is not in talks with Shanks Group.”

SITA UK's parent company, the French utilities giant GDF Suez Environnement, also took a similar line. A spokeswoman told letsrecycle.com: “We never comment on market events.”

Dutch-firm AVR van Gansewinkel has also been linked by mainstream press to a potential move for Shanks but a spokesman for AVR told letsrecycle.com that it was making no comment on the Shanks situation.

The company previously operated in the UK through its subsidiary, WEEE recycling operation Coolrec. However, the Basildon firm went into administration last December (see letsrecycle.com story).