Waste Management Bidding for AbitibiBowater Texas Recycling Plants

According to published reports, Waste Management Inc., has made an offer of slightly more than $12 million to purchase the recycling division of AbitibiBowater Inc. in an auction. The division includes three Texas recycling plants that make up the paper company’s recycling division.The three facilities are located in Houston, San Antonio and Arlington.

The bid was submitted on Nov. 9 with the U.S. Bankruptcy Court in Wilmington, Del., according to Dow Jones.
AbitibiBowater is in bankruptcy protection, and is looking to sell off assets so it can exit bankruptcy. The company also recently sold its Lufkin, Tex., paper mill to a private equity firm.

In its statement, AbitibiBowater said that it has decided to "exit the recycling processing business" in order to focus on "the collection and brokerage of recovered materials."

AbitibiBowater's recycling division processes more than 2 million tons of material per year.

In addition to assuming leases at the three plants, Waste Management would also enter into an agreement of at least three years to process recovered paper for AbitibiBowater, according to the terms of the proposed deal.
A hearing to consider the sale procedures is scheduled for Nov. 24.

AbitibiBowater also asked to pay Waste Management a $350,000 breakup fee and cover up to $150,000 of expenses if it's bested at auction.

AbitibiBowater also agreed to sell its share of hydropower plant to a new joint venture established by Hydro-Quebec and aluminum company Alcoa Inc.