Biffa agrees to £1.23bn acquisition by Montagu, GIP

Under the terms of the transaction, Biffa shareholders will receive 350 pence in cash per share, valuing Biffa's fully diluted share capital at approximately £1.231bn and the existing issued share capital at approximately £1.225bn.

The deal represents a premium of 42.9 per cent to the average closing price of 244.8 pence per share for the three month period up to 22 November 2007.

Jason Gatenby, director, Montagu said, 'Both the Montagu Funds and GIP Funds are long-term investors and together we look forward to building on Biffa's leading position across all areas of the waste management value chain. Biffa meets the criteria we look for in a business: it is a market leading business with a great workforce in a sector we understand well and where we have a demonstrable track record of success.'

Matthew Harris, GIP, added, 'We believe that waste management represents a critical infrastructure service and that the future prospects across the industry in the UK are exciting. Along with our experienced partner Montagu Private Equity, we look forward to working with Biffa's management to build on the solid customer franchise and market position that Biffa enjoys today.'

Biffa rejected a £1.2bn indicative offer from Montagu and private equity investor Hg Pooled Management for the second time in December 2007 'on the basis that it materially undervalues the business and prospects of Biffa'. An identical offer from the private equity firms was rejected in September 2007.

Montagu is an independent mid-market European private equity investor, which focuses on deals between €100m and €1bn. It has offices in London, Manchester, Paris, Düsseldorf and Stockholm.

GIP invests in infrastructure assets, targeting investments in the energy, transport and water sectors - including power generation and transmission, gas storage and pipelines, water assets, airports, air traffic control, ports and railroads.

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