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UK Terra Firma to seal debut deal

9 Jun 2003

Guy Hands' Terra Firma Capital Partners is close to sealing its debut deal with a £315m acquisition of Waste Recycling Group, the UK's largest landfill operator.

Terra Firma will pay 267.5 pence per share for the Waste Recycling and will also acquire the company’s debt, which stood at £215m at the end of last year, according to a report by Bloomberg.

Since its flotation in 1994, Waste Recycling Group has become one of the leading waste disposal companies in the UK. The company enjoyed steady growth in the 1990s but has suffered from increased competition in the waste market as well as additional costs associated with increased regulatory requirements.

The company’s shares dropped 40 per cent in the past year as it wrote down the value of its assets because of accounting errors in 2001. It reported a net loss of £9.1m last year and had net debt of £215m of debt at the end of December.

The acquisition is Hands’ first since he arranged $20bn of takeovers as head of Nomura Holdings principal finance group. His previous acquisitions include troubled hotel chain Le Meriden, UK betting shop chain William Hill and railroad car company Angel Trains.

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