Houston-based WM (Waste Management) has secured a majority stake in Avangard Innovative's U.S. business.

The acquisition will function as an independent entity - Natura PCR - which will enhance WM's capabilities for films and clear plastic wrap for pallets, furniture film, grocery bags and "potentially shrink wrap around food and beverage containers."

Avangard Innovative, which is also based in Houston, is the largest recycler of post-consumer resin manufacturing in the Americas, utilizing a proprietary technology to assist customers with ESG goals and monetize sustainability initatives.

Jim Fish, WM president and CEO, commented that "WM's core material supply capabilities, with the head start and knowledge provided by Avangard's U.S. business, will help Natura PCR quickly deliver circular options to WM's customers as an important component of our continued growth strategy in recycling. Today, there is so much untapped potential to reuse film – which impacts many of our commercial customers. We can help our customers close the loop and bring more recycled materials to the store shelf."

The new entity - Natura PCR - allows WM to boost the mechanical recycling of film and flexible plastics and convert the materials to PCR. PCR materials comprise a quarter of global plastic generation, with a mere 5 percent recycling rate.

The synergies created with the acquisition were evident before the deal closed. Dow already worked in conjunction with both WM and Avangard Innovative, creating solutions in packaging. The materials science company purchased Avangard's PCE pellets for its REVOLOOP PCR product line.

"We have been working with both companies to increase the use of recycled plastic in Dow's products, and Natura PCR brings together capabilities that will unlock more options for hard-to-recycle plastics for the industry," said Nestor de Mattos, North America commercial vice president, Packaging & Specialty Plastics, Dow, to the media. "Natura PCR further expands at scale, waste-to-market solutions across North America and advances our goal to help divert plastics from landfills to circular solutions."

PCR demand has grown as consumers seek more environmentally-friendly packaging options such as those with recycled content. As extended producer responsibility (EPR) legislation expands throughout the United States and companies seek recycled feedstock.

"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," said Rick Perez, CEO, Avangard Innovative, to the media. "After 30 years in the recycling business, WM's significant involvement, coupled with the strong relationship with Dow and other customers, will set Natura PCR up to offer the most innovative end-to-end circular economy solution in the market."

Natura PCR already has expansion plans in the works. The newly-formed independent company plans to increase recycling capabilities at Avangard's plant in Waller, Texas and is exploring new plant prospects in the Midwest. 

WM will primarily own and operate Natura PCR, with Avangard securing a minority equity position. The deal is expected to be completed in late 2022. Financial terms were not disclosed.