01 — The Transaction
The transaction.
Sale of PetStar, Promotora Ambiental's PET collection and recycling subsidiary and one of the largest PET recycling plants in the world, to Arca Continental through an open auction, at 30 times run-rate EBITDA.
Nov 2010
Preparation
Analysis and bidder identification
Jan 2011
Interest
Indications of interest
Feb 2011
Diligence
Management presentations, site visits
Apr 2011
Final bids
Winning bid selected
May 2011
Signing
Purchase agreement by July
Aug 2011
Closing
Transaction closed
Context
A non-core asset
Promotora Ambiental wanted to focus on its core businesses (waste collection, landfill management and water treatment), free capital from non-core assets and reduce debt. PetStar, its PET collection and recycling subsidiary, was the asset to sell.
01
Execution
An auction built for price tension
The strategic and financial case for the sale was set out first. Strategic bidders were identified to anchor an open auction, and more than 20 local and international parties took part, from competitors and customers to financial investors. Close contact with the leading bidders kept price tension in the process, and the auction was designed to minimize the risk of the sale falling through while keeping the widest set of options open.
02
Outcome
Sold above initial estimates
PetStar was sold to a major strategic buyer, Arca Continental, at a price above the initial estimates. The sale transformed Promotora Ambiental's balance sheet.
03
The standard was set at scale. It is applied every week.
