Hermes Infrastructure (Hermes) are pleased to announce the completion of the acquisition of a 9.45% stake in Viridor Limited (Viridor), alongside Kohlberg Kravis Roberts & Co (KKR) managed funds and other investors, who together have acquired the remaining 90% stake, from Pennon Group Plc (Pennon). As a UK investment partner, Hermes Infrastructure will adopt an active Asset Management approach that includes Board representation on behalf of our clients’ 9.45% stake.
Viridor is a UK leading Waste-to-energy, recycling and waste management company with a portfolio of assets complementary across the waste value chain. It has ten Energy Recovery Facilities (“ERF”) in operation and one under construction, maximising resource efficiency from non-recyclable waste. In 2018/19, Viridor received 6.8 million tonnes of residual waste (including joint venture facilities), producing 2,694 GWh electricity, enough to power 738,000 homes.1
Viridor is optimally positioned to benefit from the dynamic transition to a sustainable circular economy where its business model is supported by government policy.
Head of Infrastructure Hamish de Run said “This investment demonstrates Hermes’ long term commitment to sustainability despite the challenges of COVID 19. Viridor will contribute to the diversification of Hermes Infrastructure’s Value Added portfolio, providing exposure to the UK Waste-to-Energy sector, generating stable inflation-linked cash flows underpinned by long-term contracts.”
Responsible investment is a fundamental pillar of Hermes Infrastructure’s investment philosophy. Engaging in non-financial as well as financial considerations is central to achieving positive and sustainable long-term investment performance. Viridor contributes to the United Nations Sustainable Development Goals through addressing environmental and social challenges, with the delivery of a significant carbon benefit through ERF compared to equivalent landfill operations2, and the transformation of over 1.5 billion bottles and packaging items into high-grade recycled plastic products every year.3