I squared-Veolia consortium leads race to acquire KKR backed Re Sustainability

Mumbai: A consortium of US private equity firm I Squared Capital and French environmental-services group Veolia has emerged as the frontrunner to acquire KKR backed Re Sustainability (ReSL), India’s largest integrated waste management firm, said multiple people aware of the development.

However, the low-ball offer from the consortium, valuing the company at Rs 10,000-Rs 11,000 crore ($1.1-$1.2 billion), is well below the expectations of the sellers who were keen on Rs 14,000-16,000 crore ($1.45-$1.7 billion) enterprise valuation and have started evaluating other options to seek an exit, the people mentioned above added. That translates to 13-15x FY27 EBITDA.

KKR, which owns 60% of ReSL has initiated parallel discussions with a handful of Indian billionaires and business groups from South and North India to gauge their interests in the company. Many of them have similar business interests or large family offices that invest in similar assets.


The US buyout group has been invested in the Hyderabad-based company for nearly eight years and this marks its second attempt to secure a full exit from the business after 2024, following the company's NCLT-approved demerger, under which its municipal solid waste-management business was separated and subsequently sold back to founder Alla Ayodhya Rami Reddy, a businessman and YSR Congress parliamentarian. Reddy owns 40% of ReSL.

The only other PE consortium left in the fray -- National Investment and Infrastructure Fund (NIIF) and Canadian pension fund CPP Investments— has withdrawn from the race, the people said. Their earlier partner TPG had dropped off even earlier leaving just the two to make a final bid.

KKR, CPP Investments declined to comment. Mails sent to I Squared Capital, Veolia and NIIF did not elicit any responses till the press time.

Valuation Gap

“The valuation gap may make it uncertain whether KKR will proceed with a sale at the current offer,” said a person aware of the matter on condition of anonymity as the talks are in the private domain. “Even at the non-binding stage, I Squared and Veolia had made a substantially higher offer.”

ReSL focuses on industrial waste management and other environmental services and is among Asia’s largest and most diversified providers of integrated environmental and sustainability solutions. The company operates across around 100 sites in India, Singapore, the UAE, Saudi Arabia, Qatar, Oman, Kuwait, Tanzania and the US, with a workforce of about 22,000.

Re Sustainability has operations spanning municipal solid waste, industrial and hazardous waste, biomedical waste, waste-to-energy, recycling, wastewater treatment and other environmental solutions. Its municipal business covers the entire value chain—from doorstep collection and transportation to processing, recycling, composting, refuse-derived fuel (RDF) production and landfill management. The company also has businesses in construction and demolition waste, e-waste, marine waste management and environmental remediation.

ReSL has expanded its footprint to more than 85 operating locations across India and overseas markets. Re Sustainability has treated 8.7 million tonnes of hazardous waste over the life of its investment, according to KKR's latest impact report. The company’s FY26 revenues were Rs 2700 crore and Rs 930 crore of EBITDA. In FY27, it is expected to clock Rs 1100 crore EBITDA on revenues of Rs 3400 crore.

The Industrial Waste Management (IWM) segment continues to be the primary contributor to ReSL’s retained operations, accounting for nearly 80% of the company’s EBITDA in FY25.

ReSL has a large capex plan of about Rs 1700 crore for FY26-FY28, which aims at expanding its industrial and bio medical waste management footprints, entering new joint ventures in recycling operations, and strengthening its presence in Singapore.

Water Tech

Veolia, a global leader in environmental services, has expertise in water technologies, waste - including hazardous waste management—and local energy. In 2025, the Veolia group produced 45 million megawatt hours of energy, and treated 64 million tons of waste. Veolia Environment generated consolidated revenue of €44.4 billion in 2025.

Veolia India has been providing water and waste-management services in India and South Asia for more than 25 years. It works with municipalities in Delhi, Maharashtra, Mohali and Karnataka on water-supply projects, including network design and leakage detection. The company also manages hazardous waste in Gujarat. Veolia operates across 15 locations in India, with more than 1,000 employees and 2,500 contractual workers. It treats nearly 1,000 million litres of water a day and processes around 91 million litres of sewage daily. For industrial customers, Veolia manages about 1,000 cubic metres of hazardous wastewater and incinerates around 36,000 tonnes of waste every day. It also has a landfill capacity of about 18 million tonnes.

The industrial and biomedical waste management sector is benefiting from strong policy support and favourable market dynamics.

Rising environmental awareness, stricter compliance norms, and rapid urbanisation are driving demand for scientific waste handling. Government initiatives such as the Swachh Bharat Mission, extended producer responsibility, and emphasis on the circular economy are creating tailwinds for recycling and resource recovery, said the report. Additionally, policy thrust on construction and demolition, scrapping of old vehicles under the Vehicle Scrappage Policy, and increased focus on sustainable practices are likely to accelerate industry growth. These factors position the company for long-term expansion and profitability.