Hands holds on to agree Waste Recycling takeover
Guy Hands landed his first deal yesterday since leaving the investment bank Nomura and striking out on his own after Waste Recycling Group agreed to a takeover bid valuing the company at £531m.
Terra Firma, the £1bn buyout fund set up a year ago by Mr Hands, is paying £315m for the shares in Waste Recycling, one of the country's biggest waste management companies, and taking on a further £216m in debt.
The deal, worth 267.5p a share, will net £144m for Waste Recycling Group's 45.5 per cent shareholder Kelda, the owner of Yorkshire Water.
Kelda said it planned to return £74m of the cash to its own shareholders and use the remaining £70m to reduce group debts.
Mr Hands entered into exclusive negotiations to buy Waste Recycling in late March but it had appeared that the deal might have slipped through his fingers after last week's deadline for signing a deal passed without agreement being reached.
He had originally offered to pay not less than 285p a share but the price came down as the negotiations wore on.
Had the deal collapsed then Waste Recycling's share price would probably have fallen to below 200p.
The offer of 267.5p a share represents a 21 per cent premium to Waste Recycling's share price the day before it disclosed it was in takeover talks and a 34 per cent premium to its price before bid rumours began to circulate in the markets.
The existing management of Waste Recycling, led by its executive chairman, James Newman, are expected to stay with the company.
Mr Hands pledged that he would bring the "greatest possible operational and strategic focus" to the company.
Sources close to Mr Hands played down suggestions that he would use the takeover to launch a bid to consolidate the UK waste management industry, which is facing a leaner period because of the economic downturn and increasing environmental burdens.
Waste Recycling currently operates 59 landfill sites and 21 waste transfer and recycling facilities and 50 per cent of its £300m turnover comes from municipal waste contracts.
It also has an energy from waste business with a capacity of 100 megawatts.
Mr Hands has until 17 August to close the deal. Should Waste Recycling or Kelda accept a higher rival offer then they will have to pay Terra Firma break fees of £3.15m and a maximum of £6m respectively.
- 1 Man who was struck and killed by lightning in Brecon Beacons 'was carrying a selfie stick'
- 2 Lisa Randolph-Gant: Queen Elsa cake maker says she will carry on baking and will not let people 'break her spirit'
- 3 Tube strike: This pedestrian-friendly map tells you time it takes to walk between stations
- 4 Pamplona Running of the Bulls 2015: Three men gored and 10 hospitalised on first day of festival
- 5 Sarah Jessica Parker explains why she is not a feminist: 'It's not just about women now'
Man who was struck and killed by lightning in Brecon Beacons 'was carrying a selfie stick'
Greece debt crisis: Greek future in the euro slips into deeper uncertainty as Alexis Tsipras arrives at emergency talks without written plan
Man soars over Calgary after tying 110 balloons filled with helium to his lawn chair for PR stunt, gets arrested for mischief
Tube strike: This pedestrian-friendly map tells you time it takes to walk between stations
Pamplona Running of the Bulls 2015: Three men gored and 10 hospitalised on first day of festival
More Britons believe that multiculturalism makes the country worse - not better, says poll
Osborne to cap family benefits at £23,000 – announced ahead of his post-election Budget
Nathan Collier: Montana man inspired by same-sex marriage ruling requests right to wed two wives
Sickness and disability benefits could be reduced by £30 a week as part of £12bn welfare cuts
Greece debt crisis: Angela Merkel and Francois Hollande issue Athens with 24-hour ultimatum to avoid crashing out of the euro
Greece crisis: Referendum exposes a gaping hole at the heart of the European Union – its lack of genuine legitimacy
iJobs Money & Business
£40000 - £95000 per annum: Recruitment Genius: This is an exciting opportunity...
competitive: SThree: Are you passionate about sales?Do you have a keen interes...
£17000 - £30000 per annum: Recruitment Genius: This is an exciting opportunity...
£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...