Biffa – the UK waste management company owned by Global Infrastructure Partners (GIP) and Montagu Private Equity – started the sale of its landfill gas unit earlier this week, a source familiar with the process confirmed to InfrastructureInvestor.com.
Prospective bidders have been sent information memoranda and are expected to lodge bids in about a month’s time.
Biffa’s gas unit turns gas emitted from rubbish at several landfill sites across the UK into a power source. Media sources estimate its installed capacity to be between 76 megawatts and 100 megawatts, with Reuters reporting that it had earnings before interest, tax, depreciation and amortisation (EBITDA) of some £35 million (€39 million; $52 million).
That means the sale of the unit could net Biffa anywhere between £280 million and £350 million, according to different estimates in the media. Private equity outfits Terra Firma and 3i have been identified in press reports as possible bidders. Terra Firma already owns Infinis, the UK’s largest player in the landfill market, and recently won a well-publicised takeover battle with 3i for Infinis-rival Novera.
InfrastructureInvestor.com contacted GIP but the fund was not willing to comment on the matter.