Hong Kong tycoon buys Dutch waste-to-energy company

Hong Kong: A consortium led by Asia’s richest man Li Ka-shing on Monday said it had agreed to buy a Dutch waste management company, in a deal worth more than $1 billion.

The HK$9.7 billion acquisition of AVR Afvalverwerking (AVR), which specialises in turning waste into energy, is the second waste processor investment made this year by Li’s Cheung Kong Infrastructure Holdings (CKI), which is leading the consortium.

In January, CKI made a HK$3.2 billion investment in New Zealand’s Envirowaste.

“The acquisition of AVR will see us investing in a leading waste management company in Europe, possessing the largest energy-from-waste plant capacity in the continent,” Kam Hing-lam, Group Managing Director of CKI, said in a statement.

“It fits in well with CKI’s stringent investment requirements, generating immediate recurring cash flow with profitable and stable returns,” Kam said.

CKI and Li’s flagship company Cheung Kong Holdings Limited both have a 35 per cent stake in the consortium with Cheung Kong subsidiary Power Assets Holdings having 20 per cent and the Li Ka Shing Foundation holding a 10 per cent stake.

AVR has a 23 per cent market share of the Netherlands’ waste processing industry with stable revenue streams from long term contracts for gate fees and waste processing as well as revenue from generated energy, the statement said.