Veolia Environnement SA (VE: Quote) said Thursday that its wholly owned subsidiary, Veolia Environmental Services North America, has agreed to sell the US solid waste activities to Star Atlantic Waste Holdings LP, for a total transaction value of $1.909 billion.
Star Atlantic is a portfolio company of Highstar Capital, a US-based infrastructure fund manager.
When the deal is completed, Veolia's net debt will be reduced by around $1.820 billion. In the US waste business, Veolia will continue to grow its activities in hazardous waste and industrial services.
Veolia had last month announced the sale of its UK regulated water activities to Rift Acquisitions Limited for a total transaction value of 1.24 billion pounds. The French utility expects this deal to help reduce its net debt by about 1.17 billion pounds.
Antoine Frérot, CEO, said today, "This divestment is the second significant step in the execution of the strategic plan laid out last December. The transformation of Veolia is progressing as planned."
The sale is expected to be finalized by the end of the year.
This divestiture is the second significant step of the 5 billion euros asset divestment program the company plans to complete before the end of 2013.
The divestment plan focuses on three divisions: Water, Environmental Services and Energy Services, with a recomposition of the Veolia Transdev shareholding in conjunction with the Caisse des Dépôts.
The divestment of regulated Water operations in the UK and solid waste operations in the U.S. as well as continued rationalization of the company's geographic footprint were part of this plan.
In the first seven months of 2012, Veolia will have signed 60 percent of the value anticipated for the planned divestiture program. Veolia's US Solid Waste businesses had revenue of $818 million and operating income of $110 million for 2011.
The stock advanced 1.03 percent in Paris on Wednesday to close at 9.22 euros on 3.34 million shares.
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by RTT Staff Writer
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