Two large families of entrepreneurs in the waste sector form an alliance. Subject to the agreement of the Autorité des marchés financiers, Paprec, the family business founded by Jean-Luc Petithuguenin, will acquire 20% of its small listed competitor Pizzorno Environnement, valued on the stock market for around one hundred million euros. Based in Draguignan (Var), it is 72% owned by the Devalle family and 20% by the entrepreneur Claude Marquet.
Paprec prevailed over several other candidates for the purchase, at an undisclosed price, of this participation that the Devalle family had put up for sale.
The transaction is accompanied by a shareholders’ agreement giving Paprec a seat on the Pizzorno board of directors, and “a right of pre-emption in the event of the sale of shares by the Pizzorno-Devalle family. For its part, the Pizzorno-Devalle family will have the option of eventually transferring control of the company to it, if it so wishes, ”specifies a joint press release from the two groups.
Strong presence in the Var
The giant Paprec, passed in twenty-five years from 45 to 12,500 employees on 280 sites, has chained this year in quick succession the acquisitions of Tiru (ex-Dalkia Wastenergy), Cnim (specialist in incinerators), and suspicious of assets that Suez could yield. In 2021, it should reach around 2 billion euros in turnover.. Opposite him, Pizzorno, much smaller, with 2,200 people, achieved a turnover of 199 million euros last year.
It ensures the collection of household waste and the cleanliness of Toulon, part of Lyon, and the 15e arrondissement of Paris, but it is mainly present in the Var. However, this is an area in which Paprec is almost absent. If the two groups are theoretically competitors, in reality Pizzorno is therefore complementary in the eyes of Paprec, that this transaction poses as a natural buyer.
Obviously, the Stock Exchange is already speculating on a possible merger, the announcement of the operation having raised the share of Pizzorno by 4.3%, to 24.40 euros at mid-session. But this is not the aim of the operation, we are assured on the side of Pizzorno. If the company suffered a net loss of 6.9 million euros last year, due to the Covid and exceptional impairments, it is usually profitable. Little in debt, and with a strong cash flow, she therefore has no financial needs. In addition, post-operation, the Devalle family will always retain the absolute majority of the capital and the shareholders’ agreement does not make any commitment that it will sell other securities in the future.
Develop valuation
The objective displayed by Pizzorno with this opening of the round table is to provide itself with the means for industrial development in the recovery of waste by playing synergy with a powerful player in the sector, to improve technical processes and develop the activities of recovery of its waste sorting and treatment centers, such as that of Muy (Var) or its center specializing in green waste.
The two companies signed their alliance on Monday, August 9, but under conditions precedent. To finalize it, they are awaiting the position of the Autorité des marchés financiers (AMF), confirming that it will not force Paprec to launch a mandatory public offer on the shares of Pizzorno Environnement. The AMF’s decision is expected at the end of September at the earliest and, at the latest, by the end of the year.
