Waste management is a dirty business. It is also an essential cog to making the world cleaner and greener. For Biffa of the UK, “the circular economy” might also refer to its merry-go-round of public and private equity ownership. US buyout group Energy Capital Partners has launched a £1.4bn bid for the rubbish collector. That pushed up shares by 25 per cent, where they were still below the 445p offer price.
The company’s success falls into two bins. Biffa has added new routes to its main collections business, most recently by acquiring peer Virador. It has also invested heavily in waste reduction, recycling and waste-to-energy projects.
The greener tint has rewarded early investors, lifting the shares by 80 per cent since their 2016 float. Gains would rise to 147 per cent if the buyout, which the board plans to recommend, goes ahead. Sizeable debts and a consolidated market for collections are likely to keep a lid on further returns.