A new fund focused on plastics circularity and backed by some of the largest names in resin is making its initial investment as part of a larger group taking control of the company handling curbside recyclables in New York City.
Closed Loop Circular Plastics Fund, an arm of investment firm Closed Loop Partners created in 2021, is part of the investment team that's buying a majority of Sims Municipal Recycling for a reported $45.4 million.
Closed Loop said the purchase of Sims Municipal Recycling "is expected to further modernize circular economy infrastructure and service in the New York-New Jersey Metro region and Florida."
Sims Municipal Recycling was created nearly two decades ago by Sims Ltd., an Australian company best known for its scrap metal recycling operations with more than 200 locations in the United States, United Kingdom and Australasia.
The municipal recycling business handles more than 600,000 tons of curbside material each year in New York City and has material recovery facilities in Brooklyn, the Bronx, Queens and Jersey City. The company also operates a recycling facility in West Palm Beach, Fla.
Materials handled by the company include PET, high density polyethylene, bulky plastics and film, Georgia Sherwin, senior director of strategic initiatives at Closed Loop Partners, said in an email.
Closed Loop is taking a 50.5 percent stake in the recycling operation for a reported $45.4 million, according to The Wall Street Journal.
The Closed Loop organization, over the years, has grown to include a variety of initiatives aimed at creating a circular economy. Funding for the Sims acquisition includes money from the Closed Loop Leadership Fund and the Closed Loop Circular Plastics Fund. The Partnership Fund for New York City, a separate investment firm, also is buying in.
The Plastics Fund seeks out "technologies, companies and infrastructure projects that increase the quality and quantity of recycled polyethylene and polypropylene," the investment firm said.
Investors in the fund include Dow, LyondellBasell, Nova Chemicals, Sealed Air and SK Geo Centric.
"When Dow joined the Circular Plastics Fund as an initial investor, we envisioned projects like the Sims Municipal Recycling acquisition," Diego Donoso, president of Dow Packaging & Specialty Plastics, said in a statement. "I know this is just the first of several significant projects that will grow and improve recycling infrastructure in the U.S. as a result of the Fund."
The ownership change also will bring a breakthrough in corporate leadership as Sims Municipal Recycling will be one of the "first majority female-led boards in the industry," Closed Loop said.
Jessica Long, managing director at Closed Loop Partners, will be the board's chair.
"This investment, coupled with the existing portfolio of Closed Loop Partners' managed investment funds, will enable SMR to expand its services, accelerating the development of circular economy infrastructure in the United States," Long said in a statement.
Tom Outerbridge, president of Sims Municipal Recycling, sees his company growing stronger under the new owners.
"We now have an exciting opportunity to combine our strong operating history with Closed Loop Partners' extensive resources to strengthen circularity for the post-consumer municipal waste stream," he said in a statement. "Together, we can accelerate the modernization of recycling across the United States to close the loop on valuable materials and build a truly circular economy."