Igneo clinches deal for Waste Management

Igneo Infrastructure Partners has signed a $1.9 billion deal to buy Waste Management NZ from Chinese private equity firm Beijing Capital after beating KKR & Co and Morgan Stanley Infrastructure Partners to the draw, the Australian Financial Review reported.

The AFR said the deal was signed yesterday morning and followed Igneo inching itself into the pole position in the last days of the three-way race among the bidders.

The paper said Igneo — part of investment group First Sentier — was expected to fund the purchase price via a 50-50 debt and equity mix.

First Sentier has been approached by the Weekend Herald for comment on the report.

A syndicate including ANZ, Japan’s MUFG and RBC provided a $1b debt package, while Igneo’s unlisted infrastructure funds would hold the equity, the AFR said.

The deal means Beijing Capital’s doubled its money, buying Waste Management NZ from ASX-listed Cleanaway Waste Management for $950m in 2014.

Waste Management collects a million tonnes of waste a year ranging from home and garden waste to the more specialised wastes produced by commercial or industrial sites like hospitals, construction sites and factories.

The purchase will add to Igneo’s Kiwi infrastructure portfolio, which already includes First Gas, a natural gas transmission and distribution company.

First Sentier Investors Group last month announced its direct infrastructure investment team will be named Igneo Infrastructure.

New York-based First Sentier said the establishment of Igneo was part of its long-term growth strategy to build a global business consisting of inhouse investment teams.

The newly-branded Igneo has made 60 infrastructure acquisitions since 1994. The 65-strong team manages a portfolio of 24 mature, mid-market core infrastructure companies in the UK, Europe, North America, Australia and New Zealand.

It holds US$14.8b worth of assets.