Sources in the City have said that talks between WRG and the mystery buyer have been going on for “some months”, and were only forced out into the open by the recent share price increases (see letsrecycle.com story).
WRG shares rose by 29% to 285p yesterday, valuing the company at 335 million. However, experts believe that any buyer would need to offer 350p per share for the bid to succeed, which would see a deal nearer 400m. WRG also has debts of 230 million.
It is thought that the discussions between the two parties could be resolved much sooner than had been expected.
Kelda, the Yorkshire water operator that owns 46% of WRG, has been ruled out as the mystery bidder, and newspaper reports have also discounted Shanks Waste Services, Biffa Waste Services' parent company Severn Trent and Pennon.
Some in the waste management industry have said that a group of City financiers may be looking to buy the company, and it has not yet been ruled out that there is more than one party involved in the discussions.
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