Cleanaway has entered into an agreement to acquire the Australian assets of French waste management company Suez for $2.52 billion.
As reported today in the Australian Financial Review, the deal has conditions attached which depend on the outcome of a broader takeover battle playing out in France between Veolia and Suez.
Under the agreement, Suez has the right to terminate the acquisition before 6 May if an agreement in principle is announced with Veolia, or by 26 April if a superior offer for Suez Australia is made and not matched by Cleanaway.
Veolia announced its plans to take over Suez in October last year when it acquired a 29.9 per cent stake in the company.
In an ASX statement Cleanaway said that should the global takeover eventuate, it will acquire a portfolio of Suez’s post collections assets in Sydney.
The assets comprise two landfills and five transfer stations and will be acquired for $501 million, subject to various conditions.
“Suez’s Australian Recycling and Recovery business has a high-quality network of assets across Australia that will accelerate the implementation of our Footprint 2025 strategy,” Cleanaway Executive Chairman Mark Chellew said.
“The acquisition will deliver superior scale and increased operating leverage. We look forward to more than 2000 of Suez’s Australian employees joining the Cleanaway team in due course.”
Suez Australia operates a national footprint of strategically located infrastructure assets, including a workforce of more than 2000, six operating landfills, 59 collection and depot facilities, eight organics processing facilities, two medical waste facilities and a fleet of more than 1000 vehicles.
Cleanaway Chief Operating Officer Brendan Gill added that the transaction is expected to bring together two highly complementary businesses and be strongly accretive to earnings per share when the integration is complete.
“Cleanaway will continue to maintain a strong balance sheet following whichever transaction is completed and will retain ample capacity to support future growth for the combined group,” he said.