Cheung Kong Infrastructure Holdings Ltd. acquires EnviroWaste Services Ltd. for HK $410 million.
The Hong Kong-based firm Cheung Kong Infrastructure Holdings Limited (CKI) has entered the waste management industry with the purchase of EnviroWaste Services Ltd., a New Zealand-based company, for $412.8 million.
EnviroWaste is described as a diversified waste management firm that operates throughout New Zealand. According to a news release announcing the transaction, EnviroWaste offers waste and recycling-related services to about 500,000 commercial and residential customers by operating collection services, landfills and transfer stations. EnviroWaste also owns and operates ancillary business such as bulk waste haulage and a landfill gas-to-electricity generation facility.
“EnviroWaste is a quality investment with good security, having characteristics similar to that of traditional infrastructure investments,” says HL Kam, CKI’s group managing director. “Its business is underpinned by attractive, long-life infrastructure assets that feature high barriers to entry – namely the scarcity of land available for use as landfills, long and onerous consenting processes, high up-front capital costs and access to controlled waste volumes from upstream operations.”
“Waste management provides a good opportunity for future growth,” Kam continues. “The rate of increase in waste is fundamentally linked to growth in population, GDP and consumption. It is expected that New Zealand will experience long-term waste volume growth as the economy continues to expand. As the volume of waste continues to rise, waste services offer great potential for growth,” Kam adds.
The acquisition of EnviroWaste is also in line with Cheung Kong Group’s corporate initiatives to invest in environmental and land-related projects for what it calls the betterment of society.