Blackstone, EQT in Race for Waste Management Giant Urbaser

Blackstone and EQT have advanced to the next round in the sale process of Urbaser, a global waste management company, according to sources familiar with the matter. The advancement of these two prominent private equity firms signals their interest in the attractive waste management sector and the strategic value of Urbaser's global presence.

Urbaser, owned by private equity firm Platinum, has engaged Citi and Santander as advisors for the sale, which could value the waste management firm at around 5 billion euros. The private equity firm has directed bidders to commence due diligence and prepare binding offers by the last week of February. KKR and Macquarie, which initially submitted preliminary offers, are no longer in the race, leaving Blackstone and EQT as the remaining contenders.

The waste management sector has been identified as the most attractive for infrastructure investors within utilities in 2024, according to a survey by consultancy firm Roland Berger. Urbaser's presence in approximately 15 countries, including the U.S., India, Spain, and France, coupled with its 2023 turnover exceeding 2.5 billion euros, makes it an appealing target for investors.

Both Blackstone and EQT have expertise in infrastructure investments, with EQT recently selling minority stakes in its pipeline assets for $3.5 billion. By acquiring Urbaser, these private equity firms could potentially leverage synergies and operational efficiencies within the waste management sector. The strategic benefits of this acquisition include Urbaser's global footprint, stable revenue stream, and growth potential.

The sale of Urbaser, if successful, would mark one of the largest private equity deals in Europe in recent months. The strategic focus of Urbaser, as indicated by its recent disposal of its UK business, may impact the sale process and valuation. The divestment of the UK business could signal a shift in Urbaser's strategic focus towards more profitable or strategically important regions, potentially driving up the valuation in the sale process.

In conclusion, the advancement of Blackstone and EQT into the next round of Urbaser's sale highlights the attractiveness of the waste management sector and the strategic value of Urbaser's global presence. The potential synergies and operational efficiencies that Blackstone and EQT could gain from owning Urbaser, coupled with the sector's growth prospects, make this acquisition a compelling opportunity for these private equity firms. The sale process, driven by Urbaser's strategic focus and valuation, is expected to culminate in one of the largest private equity deals in Europe in recent months.