KKR, Macquarie eyeing Singapore’s waste management firm SembWaste: sources

US private equity group KKR and Australia’s Macquarie Asset Management are among potential bidders for the waste and recycling management arm of Singapore’s energy group Sembcorp, in a deal that could value the unit at around US$500 million, said two sources with knowledge of the matter.

Sembcorp, which is 49.3 per cent owned by Singapore’s state investor Temasek, has hired HSBC to run the sale of SembWaste, according to the sources. HSBC declined to comment.

The first round of non-binding bids are due by early June, said one of the sources, declining to be named as the matter is private.

Last year, SembWaste’s earnings before interest, taxes, depreciation, and amortisation was S$50 million, one of the sources added.

Potential bidders also include global infrastructure investment manager I Squared Capital, the sources said.

KKR and Macquarie Asset declined to comment. Sembcorp and I Squared Capital did not immediately respond to requests seeking comment.

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The sale comes at a time when many cities in South-east Asia need more investment in the waste management sector, due to their rapid growth in population and a shift towards both greener and cleaner energy and environment.

Last year, a Keppel consortium bought a 80 per cent stake in environmental services firm 800 Super Holdings for S$304 million.

SembWaste is one of three public waste collectors appointed by Singapore’s National Environment Agency to provide waste and recyclable collection services to residential, schools and trade premises in the city-state, according to its website.

Besides SembWaste, Singapore-listed Sembcorp is also involved in renewable energy businesses and has a balanced energy portfolio of 17.2 gigawatt (GW), with 10.3 GW of gross renewable energy capacity comprising solar, wind and energy storage globally, according to its website.

Shares of Sembcorp have surged 36.5 per cent year-to-date, beating the local benchmark stock index’s 0.2 per cent rise. It commands a market value of US$6.2 billion, according to Refinitiv data. REUTERS