Platinum Equity has entered into a definitive agreement to acquire Urbaser, a provider of environmental services, from China Tianying Inc. for an enterprise value of approximately $4.2 billion (€3.5 billion).

Urbaser is a global environmental management company oriented towards sustainability and innovation. Headquartered in Madrid, Spain, Urbaser’s core business comprises three segments – Urban Services (waste collection, street cleaning and water management), Municipal Waste Treatment, and Industrial Waste Treatment – concentrated primarily in Spain, Chile, Argentina, France, and the Nordic region.

“Urbaser is a complex company that is both vital service provider and important caretaker of the environment,” said Tom Gores, founder and CEO of Platinum Equity. “It is a leader in a sector that requires both operational excellence and ESG best practices. It is tailor-made for Platinum’s hands-on approach, and we’re excited about the opportunity.”

“The team at China Tianying have been excellent stewards of the business and we greatly appreciate their trust as a transaction partner and their confidence in our ability to build on their success and deliver a transaction that creates value for all stakeholders,” said Platinum Equity partner Louis Samson, who oversees the firm’s European operations. “Urbaser will be a strong addition to our growing portfolio of operating companies headquartered in Europe. We have a lot of momentum in Spain and in Europe generally, which is a result of the resources we have put on the ground there and our deliberate strategy to continue investing in the region. We have had a great deal of success in Europe and acquiring Urbaser represents another exciting step forward.”

“We are pleased to have reached an agreement that delivers a strong return for our shareholders while ensuring Urbaser remains in good hands moving forward,” said China Tianying chief financial officer Fengwei Guo. “We are confident Platinum Equity has the resources and expertise to pursue an exciting new phase of growth, expansion and investment.”

Upon closing, José María López Piñol will continue to lead Urbaser as Chief Executive Officer.

“Platinum’s global operating capabilities, financial resources and commitment to supporting our business make it the ideal partner,” said López Piñol. “We will be able to accelerate our geographic expansion, maintain a healthy balance sheet and continue investing in sustainability.”

“Urbaser is a highly scalable platform with an attractive value proposition across the entire spectrum of waste management services,” said Platinum Equity managing director Igor Chacartegui. “The environmental services sector is in a period of growth and consolidation, and we will leverage the company’s scale and technical capabilities to accelerate its expansion both organically and through targeted M&A investments in key geographies.”

Citi and Santander are serving as investment advisors to Platinum Equity on the acquisition of Urbaser. Latham & Watkins is serving as the firm’s legal counsel.