UK-based firm to make largest Australian exit

UK-based mid-market private equity firm Livingbridge is to achieve its largest Australian exit to date reaching agreement to sell its majority stake in Waste Services Group (WSG) to Carlyle Group (NASDAQ: CG). The deal is believed to value the business at $1 billion plus.

Terms of the transaction, which was announced on 9 December, have not been disclosed but deal was reportedly struck based on a valuation of around 13x projected 2025 financial year earnings. WSG is expected to record around $90 million in earnings before interest, tax, depreciation and amortisation (EBITDA) for the 2024 financial year.  

The sale agreement was reached following a competitive sale process in which a range of large private equity firms made preliminary bids before US-based Carlyle was granted exclusivity.

Carlyle will invest from its Carlyle Asia Partners fund. Livingbridge is reinvesting to take a significant minority stake.

Livingbridge Melbourne-based investment team member Oliver Mauldridge said: “We are committed to the continued success of WSG and are delighted to be re-investing. We look forward to partnering with management and Carlyle to build the leading commercial and industrial waste business in the region.”

Carlyle has experience in the commercial waste collection segment after acquiring European waste collection business The City Bin Co in 2019.

Carlyle managing director and head of Australia and New Zealand, Geoff Hutchinson, said: “We have been impressed by WSG’s track record of growth, enabled by its strong focus on customer service, and we think the business is an excellent platform for continued expansion. We are excited to partner with the management team and look forward to working with them on the next chapter of growth.”

Established in 2016 by chief executive Matt Tamplin, Braeside, Victoria, based WSG operates in the commercial and industrial segment of waste services sector.

The company provides services in Victoria NSW and Queensland, under brands including Premier Waste, Superior Waste, Wastefree, Wasteflex and Paper Resource. WSG services a broad range of industries including manufacturing, logistics, aged care, retail, education, trade distribution and automotive. Services include consulting with businesses on recycling and efficient waste management.

The company has around 10,000 commercial customers and employs more than 600 people.

Livingbridge invested in WSG in 2021 in a deal which is believed to have valued the business at close to $500 million. The vendors in that deal were private equity firms The Riverside Company and Silverfern Group. Under Livingbridge, WSG has made additional bolt-on acquisitions.

Carlyle plans to work with the WSG management team to further expand the business in Australia including broadening its services.

Livingbridge was advised on the sale of its investment by law firm Allens. Carlyle received financial advice from Citi.

Image: WSG consults with businesses on recycling and efficient waste management.