PreZero, which is part of Schwarz Group, will buy the Spanish and Portuguese environmental services, waste collection, waste treatment and recycling business.
The sale is expected to provide Ferrovial with a capital gain of approximately €317m assuming an equity value of €950m at the time of the signing, which could slightly vary between signing and closing. Closing of the transaction is expected before the end of this year.
The rest of Ferrovial’s Services division remains for sale, in line with its strategy to refocus on developing, building and managing sustainable infrastructure.
The Environmental Services business reported in 2020 €1.018bn in revenue and about €130m in earnings before interest, taxes, depreciation, and amortisation (EBITDA) including dividends from project finance interests. It had a backlog of €2.177bn at the end of 2020. The company has 16,000 employees. It delivers treatment and recycling services for public- and private-sector clients through 140 plants under management, where it processes 5.6m tonnes of waste every year. It also engages in street cleaning, source-sorted waste collection and green area maintenance in more than 600 municipalities throughout Spain, serving over 15m people.
PreZero, an enterprise of Schwarz Group, is an international environmental service provider with 13,000 employees at over 280 locations in Europe and North America. It provides waste disposal, sorting, processing and recycling services.
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“This deal is consistent with Ferrovial’s strategic roadmap, which is focused on developing sustainable infrastructure,” said Ferrovial CEO Ignacio Madridejos. “New technology, changes in citizens’ habits, and the demands of society make it necessary to adopt this approach to continue creating value for our shareholders, our stakeholders, and the communities in which we operate. We are also very pleased to leave our Environmental Services business in Spain and Portugal in the hands of PreZero, an international enterprise in waste and recycling management with the highest ESG standards.”
PreZero CEO Thomas Kyriakis added: “The planned acquisition is the next step in PreZero’s expansion, with which we intend to further expand our activities in Southern Europe. Ferrovial is excellently established in the field of environmental management and ideally complements PreZero’s portfolio. In the process, we anticipate valuable synergies and an additional starting point for the further development of the circular economy in Europe.”
Ferrovial had carried out a strategic review of all the businesses with the aim of focusing the company’s future on the infrastructure, the prime source of value and returns for its shareholders. As a result, it put up for sale all its Services businesses. This year it has adopted the Horizon 24 Plan, a strategy for 2020-2024 in which the company will focus on infrastructure, adding mobility, water, and electrification. The plan pursues profitability, targeting 11% annual growth in EBITDA, and focuses on excellence in developing and managing sustainable infrastructure through innovation, efficiency, and the selection of businesses and markets.
The sale of the Environmental Services business in Spain and Portugal is another step in the process of divesting Ferrovial Services, following the sale of Broadspectrum with operations in Australia and New Zealand on 20th June 2020. Divestment of the remainder of Ferrovial Services is ongoing in United Kingdom, Spain, Chile, and United States, the main markets where the company has activities in this business.
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