The move from Viridor was confirmed in its accounts for the 2022/23 financial year published in the summer.
In a statement to letsrecycle.com, the company said the move was a “planned, strategic decision” which was taken after its Avonmouth polymer plant “completed commissioning and is now online”.
The spokesperson added: “This decision is aligned to our drive to increase domestic plastic reprocessing achieve a route circularity in the four major plastics by 2025. Viridor remains eager to invest in new plastic reprocessing, and recycling policy reforms will be critical in determining the scale and pace of future recycling investments in the UK.
“Viridor’s has returned capital to shareholders following the successful divestment of our recycling, collections and landfill businesses and a stake in Viridor’s operational Energy from Waste business which has facilitated investment in new development projects.”
The move comes after Viridor posted a £13 million loss for its plastic recycling subsidiary, Viridor Polymers, earlier this year (see letsrecycle.com story), though its hoped Avonmouth coming online will boost this.
Intercontinental
Viridor took ownership of the 40,000 tonnes per year Skelmersdale facility when it acquired Intercontinental Recycling Ltd for £8.1 million in 2009 (see letsrecycle.com story). The facility took material from commercial and local authority sources per year, producing plastic pellet and flake ready for use in remanufacture.
The site specialises in processing high density polyethylene (HDPE) and polyethylene terephthate (PET) plastics bottles.
In 2014, Viridor installed a £1 million advanced flake optical sorting station at the plant, which it claimed would increase the yield of valuable HDPE natural grade it was able to produce on site.
Closure
The results for Viridor Ltd for 2022/23 read: “Following an extensive business review and increasing performance at the Avonmouth polymers facility, we ceased operation at our Skelmersdale polymers facility during the year.
“This decision is aligned to Viridor’s ambitious polymers strategy and commitment to being a fully circular plastics recycling and reprocessing business by 2025.”
Financials
More widely, Viridor Ltd posted a profit of £167.2 million in 2022/23. The company added that it is “actively seeking opportunities to develop its business including additional facilities in selected regional markets where there is a structural waste processing capacity gap, organic and inorganic expansion of its EfW portfolio and the development of new facilities to process recycled plastic and polymers.”
Viridor’s underlying revenues also grew by 20% to £672 million, which was “ahead of expectations” and boosted by high power prices. It also recorded 92% EfW availability for the second year running.
KKR
Viridor was acquired by KKR in 2020 for £4.2 billion (see letsrecycle.com story). Private equity companies traditionally keep hold of firms for around three to six years before a sale is completed.
This has led to some in the sector considering that KKR could opt to sell Viridor in the next couple of years, with the company’s energy production capacity likely to prove popular. There would be an element of uncertainty around the plastics operation at Avonmouth as this is relatively new but it could prove attractive in light of a desire to see more plastics recycled although the financing of the process is currently less certain than that for energy sales.
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