The market may have dropped lower today, but that hasn't stopped the BINGO Industries Ltd (ASX: BIN) share price from charging higher.
The waste management company's shares finished the day 6% higher at $2.28 following the release of an announcement late on Wednesday afternoon.
What was announced?
Just before the market closed on Wednesday BINGO announced the sale of its Banksmeadow facility to CPE Capital for $50 million.
According to the release, the Australian Competition and Consumer Commission (ACCC) has approved CPE Capital as the purchaser of the Banksmeadow facility under the terms of the court-enforceable undertaking in February which was required to support the acquisition of Dial A Dump Industries (DADI). The sale of the Banksmeadow facility is expected to complete by October 9.
This is a positive for the company as it can now focus on integrating the DADI business and on the development of its Recycling Ecology Park at Eastern Creek.
The DADI acquisition is expected to be a key driver of growth in the future.
Earlier this year BINGO's managing director and CEO, Daniel Tartak said "I am pleased to announce the completion of the acquisition of DADI. The acquisition reinforces our focus of growing our network of strategic waste infrastructure assets, and supports the ongoing diversification into Commercial & Industrial (C&I) waste processing and enhanced vertical integration. We expect this strategy to deliver long term value to BINGO customers and shareholders."
Mr Tartak also spoke very positively about the Recycling Ecology Park at Eastern Creek.
He added: "The development of our Recycling Ecology Park at Eastern Creek will not only be transformational for BINGO, but also for recycling in the greater Sydney region. Our vision to create a Recycling Ecology Park will allow us to consolidate our recycling, processing, distribution and landfill at a single site, and will deliver significant economic benefits and operational efficiencies. It will also allow us to further grow our waste volumes by freeing up space across our network of resource recovery facilities, some of which can be better utilised as transfer stations."
Should you invest?
Although its performance in FY 2019 was disappointing, I think investors should look beyond that and focus on its strong long-term growth potential thanks to the drivers listed above.
