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Global investment firm KKR has acquired a 60 per cent stake in Ramky Enviro Engineers Ltd (REEL) for approximately $530 million via a combination of primary and secondary investments.
The investment, which KKR has made from its Asian Fund III, values the company at $925 million.
BusinessLine had earlier reported about the likely development.
Hyderabad-based REEL, part of the Ramky Group, is an environmental engineering services company. Its comprehensive offerings include the management, collection, transport and processing of hazardous, municipal, biomedical and e-waste, as well as the recycling of paper, plastic and chemicals.
The company also focusses on renewable energy generation, with a strong focus on waste-to-energy processes, and offers consulting and integrated environmental services.
REEL has a presence in over 60 locations across 20 States, as well as in certain South-East Asian, West Asian and African markets.
KKR’s investment in REEL marks one of the largest buyouts in India, in addition to being the first private equity buyout in the country’s highly attractive environmental services sector.
M Goutham Reddy, Managing Director and CEO of REEL, said: “REEL was founded by A Ayodhya Rami Reddy (Chairman of Ramky Group) with a vision that sustainable development is the key to success and with an objective of serving society through environmental management. With KKR as our new partner, we look forward to advancing our mission of responsibly addressing the environmental issues that emerging economies including India are facing today. Today marks the beginning of the next stage of REEL’s evolution towards serving society.”
Sanjay Nayar, Member & CEO of KKR India, said: “We are excited to partner with REEL, the only comprehensive environmental management company offering end-to-end environmental and waste management services across India. REEL’s work uniquely supports the Swachh Bharat Mission, and our team is pleased to invest in the growth of a company that provides critical services and infrastructure to reduce pollution and address the needs of India’s expanding urban population.”
“We look forward to leveraging our resources to enhance REEL’s operational best practices and add value by focussing on engineering innovation, attracting managerial talent and boosting efficiency, in addition to building on REEL’S rigorous focus on environmental, health and safety initiatives,” said Rupen Jhaveri, Managing Director at KKR. “We will work alongside REEL’s experienced management team to enhance the company’s mission of becoming a world-class leader in environmental management at a time when implementing sustainable solutions is more important than ever.”
Barclays and EY are acting as REEL and KKR’s advisors, respectively. Link Legal is serving as REEL’s legal counsel, and PwC and Transaction Square as its tax advisors. Cyril Amarchand Mangaldas and Simpson Thacher & Bartlett are serving as KKR’s legal counsel, with Deloitte India acting as accounting and tax advisor. Environmental Resources Management is the as environmental management advisor to the deal.
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