Biffa: Banks To Seize Troubled Waste Company
One of Britain's largest household waste collectors is about to be seized by its lenders because of crippling debts.
Biffa, which employs around 6,000 bin workers and has household collection contracts across the UK, is handing control of the business to creditors led by banking giant HSBC after struggling to repay debts, according to The Sunday Times newspaper.
Biffa is understood to have been saddled with more than £1 billion worth of loans since 2008 when it was taken private by three investment firms: Montagu, Global Infrastructure Partners and the private equity arm of Halifax Bank of Scotland.
The £1.7 billion takeover was financed with £1.1 billion of loans from around 70 banks and financial institutions. But its profits have been wiped out by large interest payments on the debt.
Biffa was founded more than 100 years ago and is the UK's second-largest waste collector.
Based in High Wycombe, Buckinghamshire, it collects around four million tonnes of waste a year from around 75,000 industrial and commercial customers and one million households.
The group was spun off from Severn Trent in 2006, although it started as a haulage business collecting waste from coal-fired power stations in the London area.
A Biffa spokesman said: "Biffa is a profitable, cash generative business which is performing in line with its plans.
"The company is undertaking a well-managed, planned restructuring process, working with its lenders to reduce the debt on the business."
HSBC declined to comment.
GMB, the union for street cleaning and refuse staff, is seeking urgent talks with Biffa to protect jobs and services.
Brian Strutton, national secretary for public services at the GMB, said: "Biffa is a fundamentally sound business crippled by the greed of private equity owners.
"The core waste and recycling operation can emerge stronger without the millstone of debt around its neck."