Waste Management moves into film recycling with Avangard deal

America’s largest solid waste management company is getting into recycled plastic film processing by taking controlling interest in Avangard Innovative’s US business.

Waste Management Inc., which goes by WM, becomes the second major trash and recycling company this year to push hard into recycled plastics processing following a move by competitor Republic Services Inc.

While Republic Services is building its own facilities, Houston-based WM has decided to jump into the market through the purchase of an existing operation.

“This transaction helps the business quickly scale operations, maximize source feedstock and meet the continued rise in demand for environmental additives, such as recycled plastic resin,” Avangard Innovative CEO Rick Perez said in a statement.

Under the new ownership structure, the operation will be known as Natura PCR and operate as an independent company.

WM expects the business “to scale and grow” recycling capacity to an estimated 400 million pounds of post-consumer resin in the next five years.

“WM’s controlling interest in Natura PCR positions us to grow and scale rapidly in the emerging PCR space,” WM CEO Jim Fish said in a statement. “WM’s core material supply capabilities, with the head start and knowledge provided by Avangard’s US business, will help Natura PCR quickly deliver circular options to WM’s customers as an important component of our continued growth strategy in recycling.”

WM has traditionally served as a collector of recycled plastics from residential, commercial and industrial customers, providing initial sorting through a network of material recovery facilities around the country.

The move to purchase a controlling stake in Natura PCR moves the company into the actual processing of used plastics into recycled pellets that can then be used by other companies to make new products.

“Through Natura PCR, WM expects to deliver new recycling capabilities for its customers and provide circular solutions for films and clear plastic wrap used commercially, such as plastic stretch wrap for pallets, furniture film, grocery bags and potentially shrink wrap around food and beverage containers ,” W.M. said.

Republic Services, meanwhile, is in the process of building that company’s first plastics recycling center in Las Vegas to produce food-grade PET flake. The company, the second largest solid waste management firm in the nation, also has signaled intentions to build additional facilities around the country.

“Natura PCR plans to grow recycling capabilities at Avangard’s existing plant in Waller, Texas, and build new plant capacity in the Midwest,” WM said in announcing the transaction.

Avangard and affiliates will keep a minority state in the firm through the deal expectations to close late this year.