UK-based waste disposal group Shanks has sold its subordinated debt and 80 percent of the equity stakes in two of the group’s existing privately financed contracts – East London Waste Authority (ELWA) and Dumfries and Galloway (D&G) to John Laing Investments for £25 million (€28.7 million; $39.5 million) in cash.
Shanks will continue to retain the long-term operating contracts for both ELWA and D&G, the group said in a notification to the London Stock Exchange (LSE).
A memorandum of understanding has also been signed with John Laing Investments, according to which the firm can co-invest with Shanks to bid for future PFI contracts. Shanks said this move fits with its overall aim of reducing its equity distribution to PFIs but maintaining the long-term operating contracts.
London-listed Shanks is a provider of recycling, organic processing and private finance initiative waste management services. It is active in the UK, Belgium, Netherlands and Canada.
Earlier this year, the group ended its discussions with US investment firm, The Carlyle Group, over a possible buyout offer.