The deal with Berryman, one of the UK's largest commercial and domestic glass collectors and processors, involves an undisclosed payment for the recycle-more-glass assets and trade. It also includes a five-year supply agreement for the PRNs – packaging waste recovery notes – issued on the glass, with an option of extending this further.
Commenting on the sale, Valpak chief executive Jonson Cox said: “Valpak founded recycle-more-glass in order to increase UK glass recycling levels. Having completed this essential groundwork, we feel recycle-more-glass can only continue to flourish under the expertise and infrastructure that Berryman can provide.”
Valpak launched the service in June 2001 collecting mixed glass from 1,500 pubs, bars and restaurants in London, Yorkshire and Avon for use in the aggregates sector.
In the 18 months since then, Valpak has now signed up about 16,000 licensed premises to the service, with collections growing from a rate of around 20,000 tonnes a year to 60,000 tonnes a year with its fleet of 34 vehicles.
But critics have said that this service has been run at an enormous cost – thought to be in the order of 50-80 per tonne, and with low prices for PRNs the compliance scheme is said to be finding it hard to make the figures stand up.
However, a spokeswoman denied that the low price of PRNs had anything to do with the sale. She said Valpak's reason for disposing of recycle-more-glass was that “Valpak has developed recycle-more-glass, we are now handing it over to Berryman, who have the expertise and infrastructure to develop it further.”
Strange
Experts in the glass packaging sector have questioned the timing of the recycle-more-glass sale, suggesting that had Valpak held out for another 12 months, much higher glass PRN prices would have made its recycle-more-glass service more cost effective.
One glass sector analyst told letsrecycle.com: “This seems a strange decision by Valpak at a time when it is recognised that from next year, glass targets are likely to rise steeply to meet the expected EU increases and compliance schemes will need every tonne they can get.”
Recent work by the government's Advisory Committee on Packaging would suggest that business targets for glass may have to jump to 50% in 2004. Since the recycling rate is about 34% for glass packaging at the moment, it is thought that a 2004 target as high as 50% would require over 100,000 tonnes more glass to be recycled than current levels.
With the resulting demand for PRNs, some have suggested glass PRN prices might rise to as high as 30 to 40 a tonne in 2004.
Berryman is therefore understandably pleased to have taken on the service. Mick Keogh, general manager at Berryman said: “The acquisition of recycle-more-glass fits in very well with our extensive investment programme to provide more and better quality recycled glass to our customers. We look forward to building on this solid foundation that Valpak has laid.”
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