EQT Partners, via its EQT Infrastructure II, paid Carlyle Group $455 million for insolvent water and wastewater management business Synagro Technologies, according to a press release.
Synagro was the first asset acquired by Carlyle Infrastructure Partners, the private equity firm's infrastructure fund, in 2007, in a take-private deal worth $772 million.
Carlyle had put portfolio company Synagro in play in January, bringing investment bank Evercore Partners in to find a buyer.
Prior to its Wednesday transaction, Synagro filed for Chapter 11 bankruptcy protection in order to prepare to restructure its debt. Synagro obtained $30 million of debtor-in-possession financing to keep in business until its sale to EQT is completed.
Following its 2007 purchase, Houston-headquartered Synagro faltered in the wake of the global financial crisis , as municipal spending on waste and wastewater service decreased.
In addition, the company, founded in 1986, lost a major contract in New York. A contract with Detroit was also cancelled amid a purported bribery scandal, Reuters reported.
By April, Synagro had defaulted on its debt, according to Moody’s, a credit rating agency.
Synagro marked the latest transaction for EQT Infrastructure II: in January, the fund paid $419 million for Westway Group, a global provider of bulk liquid storage in New Orleans.
Earlier that month, EQT Infrastructure II, the second infrastructure fund offering from Stockholm, Sweden-based EQT, closed on €1.9 billion.
Synagro is able to recycle industrial and municipal organic waste into fertiliser and alternative fuel.