Waste Management to sell Wheelabrator to private equity firm

Waste Management Inc. (WM), headquartered in Houston, has agreed to sell its Wheelabrator Technologies Inc. (WTI) division to an affiliate of the private equity firm Energy Capital Partners (ECP) for $1.94 billion in cash.

Wheelabrator owns or operates 17 waste-to-energy (WTE) facilities and four independent power-production facilities in the United States.

The division being sold processes more than 7.5 million tons of waste and has a combined electric generating capacity of 853 megawatts. Wheelabrator also operates four ash monofill landfills, three transfer stations and an ongoing development and construction project in the United Kingdom.

Along with the sale of the assets, Waste Management has entered into a long-term agreement to supply waste to certain WTI facilities.

“This transaction aligns with our goal of driving shareholder value by maximizing our focus on our core business and reducing earnings volatility related to electricity sales,” says David Steiner, president and CEO of Waste Management. “We look forward to a long-term partnership with ECP through our waste supply agreement.”

Steiner continues, “We appreciate the hard work and dedication of our Wheelabrator employees. They made our waste-to-energy business successful, and we anticipate that the business will continue to be successful under ECP’s ownership.”

Tyler Reeder, a partner with ECP, says, “ECP is excited about our acquisition of Wheelabrator given its excellent operating track record of critical assets, and talented and entrepreneurial employees. We believe Waste Management’s strong waste supply capabilities will complement ECP’s deep experience in power generation; and we look forward to continuing to provide Wheelabrator customers and partners with the same continued excellent service they have enjoyed under Waste Management’s ownership.”

The transaction, subject to Federal Energy Regulatory Commission approval and other customary closing conditions, is expected to close in late 2014.