EMEA: New bidders emerge in Cory Riverside sale process

02 March 2018 - 12:00 am UTC

Equitix has joined forces with at least one Asian investor to bid for London-based energy from waste business Cory Riverside as demand from Far Eastern investors in the sector grows, sources close to the process said.

Itochu was cited by sources to have formed a consortium with the UK manager ahead of a non-binding bid deadline of 5 April, although one source involved linked Marubeni to Equitix’s bid.

It has also emerged that Arcus Infrastructure Partners has appointed Credit Agricole to advise it on a bid for Cory Riverside, which is owned by Strategic Value Partners, Commerzbank and EQT Credit.

Sources said Ancala is also looking to submit a first round bid for the business, whose main asset is a London-based 66MW EfW plant, which processes around 750,000 tonnes of waste a year sourced from a mix of municipal authorities across the UK capital as well as from commercial sources. It also owns four transfer stations along the River Thames where waste is transferred to barges, and a facility at Tilbury which processes the ash leftover from incineration.

Ancala, which recently launched a EUR 600m infrastructure fund, has made a rapid series of acquisitions in the UK biogas sector, including AD companies Biogen and Tamar Energy.

Sources added that Ancala would not likely submit a lone bid. The fund manager does not currently own EfW plants in the UK, although Cory Riverside last year announced plans to incorporate AD at the site from 2021 as part of an expansion that would include solar PV, battery storage and a data centre.

The Equitix partnership is one of two major consortia that are expected to dominate the bidding process for the plant, a source familiar with the process said. As previously reported, another consortium comprising Dalmore Capital and Amber Infrastructure’s International Public Partnerships is also expected to put an offer forward.

Munich ERGO Asset Management GmbH (MEAG) is also looking at the plant, one source said. The German asset management arm of insurance firms Munich Re and ERGO has typically invested in onshore wind, solar, district heating and gas-fired plants around Europe.

Cory Riverside is also understood to be attracting strong interest from Chinese investors. Among the interested parties is China Everbright, which has made substantial EfW gains around the world in recent years, including Poland and Vietnam.

Itochu is a well-known player in the UK waste market, having partnered with Suez on a number of waste PPP contracts. These include a 20% stake in Suez’s 200,000 tons-per-year Teesside EfW in the north east of England, currently being refinanced, and a 33.3% stake in a 400,000 ton capacity Severnside EfW in Gloucestershire where waste is treated on behalf of councils in West London.

Itochu also owns stakes in Suez’s Suffolk EfW, its construction-phase gasification and anaerobic digestion plant in Surrey, and a 20% stake in the Wilton EfW plant near Newcastle, a 450,000 ton capacity plant built as part of a PPP contract with Merseyside Waste Disposal Authority.

Marubeni meanwhile is a major player in the UK’s offshore wind space but is less established in waste market. It is, however, active in Asia where it has partnered with Suez to develop an EfW plant in Thailand with Suez, Glow Energy and WHA Utilities and Power.

Ancala and MEAG declined to comment. Arcus, Equitix, China Everbright, Marubeni, and Itochu could not be reached for comment at press time. Cory Riverside declined to comment.

 

Cory Riverside