Chinese state-owned company Beijing Capital Group has agreed to purchase Transpacific New Zealand waste management firm for $NZ950 million ($890 million), in a move seen to help fight off China's burgeoning chronic pollution as it gets to acquire new technology from the Kiwi company.
A member of China's Top 500 Enterprises, Bejing Capital specializes in water treatment, waste management, mass transit railways and toll roads. Its assets are over $US21 billion. Its 2013 sales alone hit $US3.7 billion.
Transpacific New Zealand meantime specializes in landfill methods that are environmentally friendly as well as odor management and hazardous waste handling.
"The investment carries significant...mutual technical and commercial benefits," Wang Hao, BCG Chief Executive and Deputy Chairman, said in a statement.
He said the acquisition will help the company and China create measures to tackle the country's choking pollution.
Hasan Tevfik, a Sydney-based Credit Suisse strategist, told WSJ waste management is going through massive growth in China. "Given how new the industry is they're likely looking to extract what they can in terms of expertise."
"BCG believes substantial scope exists for cross border co-operation given the technical knowledge base of TPI NZ Management in areas such as landfill and local area environment management," Mr Hao said.
The purchase agreement is still subject to regulatory approval in China and New Zealand. Once given the green light, the agreement will give Beijing Capital ownership of landfill sites, recycling depots and hazardous-waste treatment facilities across New Zealand.
TPI NZ is New Zealand's leading waste management company, with revenue of approximately NZ$369 million and earnings of approximately NZ$107 million in the 2013 financial year. TPI NZ has an established national network of vertically integrated local waste systems. The company has around 1,100 employees, 800 vehicles, 29 refuse transfer stations and 5 landfills.