Wednesday, January 16, 2013

Carlyle to Dump Synagro

Waste Recycling News reported:

The Carlyle Group, owners of organic waste recycling and wastewater treatment heavyweight Synagro Technologies Inc., is reportedly in talks to sell the subsidiary.

Reuters reports that Carlyle has directed its financial advisory firm Evercore Partners to reach out to potential buyers. Synagro has been saddled with debt and received a waiver to work on its debt problems in late 2012.

First LifeCare Hospitals imploded from Carlyle loading the affiliate with debt, now Synagro Technologies faces a similar fate:

The company's debt climbed with decreased spending by municipalities after the 2008 financial crisis and the loss of major contracts in New York City and Detroit, the report indicates. If a sale does not go through, Synagro could be taken over by the debt holders.. 

The Detroit loss came from Synagro's bribing Councilwoman Monica Conyers, who was recently released from prison for her conviction.  Fresh testimony on Synagro's dirty dealings came from Detroit. A number of ethical violations occurred under Carlyle's PEU ownership.  How will Synagro's last chapter as a Carlyle Group affiliate end?  Will it be a bloated carcass?

Update 1-21-13:  The Carlyle Group isn't mentioned in the dozens of stories on Synagro's bribing of Detroit City Council members.   It's fascination how the media helps Carlyle keep their "good name."

Update 5-11-13:  Synagro executives were aware of the bribery, but the company was never charged, nor was its owner, The Carlyle Group.