Billionaire Kerry Stokes' SGH Holdings (SGH Limited (ASX:SGH)) is believed to be lining up as a serious contender to acquire Bingo Industries (Bingo Industries Limited), as Macquarie Group prepares to test market interest for the troubled waste management business through a sale. DataRoom revealed this month that the waste management company was being put up for sale by MA Moelis for owner Macquarie, as Bingo wrestles with between $800 million and $1,000 million of debt. SGH Holdings, run by Kerry Stoke's son Ryan, is understood to see strong synergies between Bingo and Boral, the country's largest building materials provider, which sits within the overall SGH portfolio.
Boral has a commanding market share in commercial construction, while Bingo's core business is handling waste from building sites and providing skip bin services. SGH, which is also bidding for BlueScope steel with Steel Dynamics, brings management expertise spanning both industries. Boral boss and SGH Group director Vik Bansal previously ran listed waste management company Cleanaway.
Boral's chief operating officer Matt McKenzie also worked for Mr. Bansal at Cleanaway, where he was general manager of solids waste in NSW. Mr. McKenzie is viewed as a potential successor to Mr. Bansal at Boral when he steps back to focus on boardroom roles. Bingo's current chief executive, Kevin Gluskie, is a former top building materials executive, previously working as Heidelberg's Asia-Pacific executive director.
DataRoom understands SGH's interest is at a price far lower than what Bingo owes its lenders. Yet a sale process could prove to be what Macquarie needs to convince lenders to take a haircut on their investment, particularly if offers come in short of what is owed. Sources believe other building materials operators are also keen to take a look at Bingo when an official sale process gets under way.
Heidelberg, which recently purchased the Australian building materials portfolio from Maas Group for $1,700 million, is expected to be interested, along with CRH, which owns AdBri, and Saint Gobain. Cleanaway would at least examine the opportunity, having considered an acquisition of Bingo before it listed on the ASX in 2017. Expectations are that the situation plays out in a similar way to Healthscope, for which MA Moelis ran a sale process on behalf of client Brookfield.
However, there were no buyers for Healthscope as a whole at a price that would clear debts and the business was placed into receivership. Bingo was purchased by Macquarie Asset Management in a $2,600 million buyout deal in 2021, but has been hammered by excessive debt, a construction market downturn and the departure of founding managing director Daniel Tartak after he was charged with criminal cartel offences.
