A consortium of investors led by the Closed Loop Leadership Fund, L.P., a private investment fund managed by Closed Loop Partners has announced the acquisition of a majority interest in Sims Municipal Recycling, the processor and marketer of all commingled kerbside recyclables collected in New York City, as well as surrounding towns and cities. SMR also handles recyclables for Palm Beach County, Florida. In 2021, the company processed 660,000 metric tons of municipal kerbside materials.
Sims Municipal Recycling, which was formed in 2003, today operates four recycling facilities across the New York-New Jersey metro region and Florida, including its Brooklyn materials recovery facility (MRF), which is the largest dual-stream recycling facility in North America. The New York City residential recycling contract, which runs through at least August 2034, is the largest municipal recycling contract in North America, and following the completion of the acquisition SMR will continue to provide important recycling services to New Yorkers and communities across the NY-NJ metro region and Florida, said Tom Outerbridge, president of SMR.
This acquisition is expected to further modernise circular economy infrastructure and service across these regions as well as expand SMR’s operations into new markets, creating additional local jobs in the recycling and manufacturing sectors.
In cities across North America, including New York, zero-waste goals are becoming a top priority with the growing urgency of climate risks and increasing landfill costs. According to the Circularity Gap Reporting Initiative, 70% of all global greenhouse gas (GHG) emissions are related to material handling and use, making circular economy infrastructure a critical part of the solution to our climate crisis. Expanding access to recycling services and enabling local circular economy manufacturing can help cities and businesses avoid the cost of landfilling products and packaging while eliminating the GHG emissions associated with manufacturing using virgin materials, and helping to create thousands of local jobs and more resilient communities.
Under the present deal, the consortium, including investment funds managed by Closed Loop Partners, such as the Closed Loop Leadership Fund and the Closed Loop Circular Plastics Fund, as well as the Partnership Fund for New York City, among others, has acquired 50.46% of SMR from Sims Limited, a metal recycling business listed on the Australian Stock Exchange, for $US45 million.
Sims will retain two of the five seats on the Sims Municipal Recycling board. That board will become one of the first majority female-led boards in the industry following the acquisition, with Jessica Long, Managing Director at Closed Loop Partners, as its Chairperson.
The Closed Loop Leadership Fund, Closed Loop Partners’ managed buyout fund, includes investors Microsoft Climate Innovation Fund, Nestlé, PepsiCo and Unilever, alongside family offices, pension funds and foundations. It also marks the first investment from the Closed Loop Circular Plastics Fund, Closed Loop Partners’ catalytic flexible financing fund that launched in 2021, and includes investors Dow, LyondellBasell, NOVA Chemicals, Sealed Air and SK Geo Centric Co., Ltd. Closed Loop Partners’ Circular Plastics Fund finances technologies, companies and infrastructure projects that increase the quality and quantity of recycled post-consumer and post-industrial polyethylene and polypropylene.
Together, these companies each have ambitious commitments to use recycled materials in their manufacturing supply chains, yet the current supply of recycled plastics meets only six percent of demand for the most commonly used plastics in the U.S. and Canada. This investment in SMR will help optimise the recovery of these and other key materials, helping to return valuable resources to manufacturing supply chains in the U.S. & Canada for use as feedstock for future products and packaging.