Australia's CPE makes $1.7b bid for Bingo Industries

The consortium – which includes Macquarie Infrastructure & Real Assets and could incorporate other co-investors – is willing to buy all outstanding shares for A$3.50 apiece through a scheme of arrangement, according to a filing. While a cash offer is specified, the proposal references another option, still under development, that would allow shareholders to receive cash plus stock in the acquisition vehicle.

The offer represents a 28% premium of Bingo’s January 18 closing price. As of early afternoon trading on January 19, the stock was up 19.7% at A$3.28.

Bingo was established in Sydney in 2005 as a family-owned skip business with four trucks and 100 bins. It targeted construction sites and infrastructure projects. In 2014, the company entered the commercial and industrial space – serving commercial offices and customers in sectors ranging from hospitality to education to healthcare – expanding its fleet to 65 trucks and opening its first recycling center.

As of June 2020, Bingo had an annual disposal capacity of 4.6 million metric tons, with processing, landfill and recycling facilities – as well as waste equipment manufacturing plants – across New South Wales and Victoria. The company has 250 trucks collecting from construction sites and 75 serving commercial customers.

Revenue and other income came to A$509.7 million for the 12 months ended June 2020, up from A$402.1 million a year earlier. Recycling accounts for approximately 50% of revenue, with waste collection accounting for 46%. Net profit for the year was A$66 million, up from A$22.3 million in 2019.

The lockdowns and social distancing impacted business in the first six months of last year and construction activity is expected to weaken in 2021. However, Bingo believes this will be partially offset by Australia ramping up infrastructure spending, with the New South Wales and Victoria governments committing A$125 billion to projects over the next four years.

CPE – formerly known as CHAMP Private Equity – was established in 1987 and has since made 75 platform investments across eight funds, deploying A$3.8 billion. The firm is currently in the market with its fifth buyout fund, targeting A$800-900 million.

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• Topics
• Australasia
• Buyouts
• Support services
• Industrials
• Australia
• CPE Capital