(Sharecast News) - Biffa has acquired south of England-focussed industrial and commercial waste collection company Simply Waste Solutions, it announced on Friday.
The FTSE 250 company said it had acquired 100% of the share capital of Camo, which trades under the Simply Waste brand, for an upfront debt and cash free consideration of £35m.
It said it was being funded from existing committed debt facilities.
For the year ended 31 March, Simply Waste reported revenues of 32m, EBITDA of 5.2m, operating profit of £3.1m and gross assets of £16.4m.
A potential further consideration of up to £5m could become payable, depending on the performance of the business through to 31 March 2021, Biffa said.
It described Simply Waste as a "prominent" and "well-regarded" operator in the south of England.
The firm's operational locations in west London, Oxfordshire and Bristol were said to align well with Biffa's existing portfolio, and once merged into the Biffa industrial and commercial collection network, would result in an "enhanced" customer proposition and a lower-carbon, more efficient collection network, the board claimed.
The acquisition would be earnings-accretive for Biffa from the outset, and would deliver synergies from operational benefits.
It was in line with both Biffa's stated investment strategy to grow its industrial and commercial operations, consolidating its leading position in the "highly fragmented" market, and its ambition as set out in its sustainability strategy to create the UK's most efficient, low-carbon collection operation.
"The acquisition of Simply Waste demonstrates further progress against our strategic plans," said chief executive officer Michael Topham.
"We have a clear focus to grow our industrial and commercial business through acquisitions as a natural consolidator within this fragmented market.
"Simply Waste has an excellent reputation, complementing Biffa's existing footprint in the south of England, and I am confident that this acquisition will enhance the strength of our service offering in the region for our combined customers."
At 0936 BST, shares in Biffa were up 2.43% at 233.02p.
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