EQT signs $5.3bn deal to acquire waste-to-energy solutions provider Covanta

EQT Infrastructure has agreed to acquire Covanta Holding Corporation, a New Jersey-based waste-to-energy solutions provider, for $5.3 billion.

The deal will enable the publicly listed Covanta Holding Corporation to go private. Currently, the sustainable waste and energy solutions provider is listed on the New York Stock Exchange (NYSE).

As per the terms of the deal, Covanta Holding Corporation’s shareholders will get $20.25 in cash per share. The consideration includes the assumption of the company’s net debt obligations.

Michael Ranger – Covanta Holding Corporation President and CEO said: “EQT certainly recognizes the value we see in our business and represents an excellent outcome of our strategic review.

“Furthermore, as an organization dedicated to sustainability and environmental stewardship, EQT shares our vision for a safer, cleaner and more prosperous future through sustainable waste management thereby ensuring no waste is ever wasted.

“We couldn’t ask for a better partner as we embark on this next phase of our company’s evolution, delivering on our goal of building a sustainable future for all stakeholders.”

EQT signs $5.3bn deal to acquire waste-to-energy solutions provider Covanta. Photo courtesy of Covanta Holding Corporation.

Based in Morristown, Covanta Holding Corporation has 41 waste-to-energy facilities in key metropolitan regions in the US, Canada, and also Europe.

The firm has a workforce of nearly 4,000 full time team members, who convert almost 21 million tons of waste into sustainable electricity, generating approximately 10TWh of baseload electricity and nearly 600k tons of recycled metals annually.

The three business segments of Covanta Holding Corporation are waste processing and services, production of energy, and recycling of metals.

The waste-to-energy solutions provider is estimated to generate EBITDA of around $460 million to $480 million in 2021.

Alex Darden – Partner within EQT Infrastructure’s Advisory Team, said: “EQT and Covanta are proven business leaders who share a like-minded approach to environmental stewardship, and this acquisition aligns directly with EQT’s thematic approach of investing in sustainable businesses that have a positive impact on society.

“EQT is excited to partner with the entire Covanta team and to invest in organizational, operational and digital technology initiatives that will enhance Covanta’s ability to provide sustainable solutions to growing waste challenges. As a responsible investor, EQT is committed to working with Covanta on transforming and supporting the energy transition and circular economy across its local communities.”

The deal, which is subject to customary conditions and approvals, is likely to be wrapped up by the year end.