4 June 2008

One of the UK’s most successful social enterprises announced this week that it has sold its recycling business to a stock market listed company.

ECT Recycling, which until this week was part of the not-for-profit ECT Group, has been acquired by May Gurney, a leading UK maintenance and support services company.

The acquisition followed moves by ECT Recycling to find a way to secure its future and build on its work in delivering municipal waste services to local authorities.

Last month the group revealed it was selling off some of its community transport interests, including Dartmoor Railway, Weardale Railway and industrial railway specialist RMS Locotec (New Start, 4 April).

Stephen Sears, who has led the development of ECT since 1980, said: ‘ECT has been looking for a partner for our recycling and waste management business with a good reputation in the local authority market place and with the commercial muscle to help us to secure bigger contracts.

This will allow us to deliver our social and environmental objectives as well as the financial results that are essential to continued success.’

The current management team led by Mr Sears will remain in place at ECT Recycling.

The firm insisted it would retain a strong responsibility to communities and the environment, continuing to operate as a community interest company.

ECT Group, which includes the charity Ealing Community Transport, will carry on operating community transport services in Ealing, Milton Keynes and Cheshire.

It will maintain the E&HCT joint venture with Hackney Community Transport, which transports construction workers within the Olympic Park, on behalf of the Olympic Delivery Authority.

A health centre in Ealing that ECT jointly runs will become an independent organisation under the changes.

Nick Temple, policy and communications officer at the School for Social Entrepreneurs, predicted that more acquisitions of this type would happen in the future as social enterprises outgrow their structures.

‘I’d like this to prompt a debate about the scale of organisations in the sector,’ he said.

London Community Recycling Network said the fact that ECT Recycling proved attractive to a listed company showed the potential of the social enterprise model.

‘What ECT has achieved in just a few years is a credit to its team and to the social enterprise model,’ said a spokesperson.

Jonathan Bland, chief executive of the Social Enterprise Coalition, said: ‘ECT is changing the way they do business, and part of that is finding new partners so they can continue their operations. We welcome an approach that ensures their businesses and employees are secure.’

by Rosie Niven
rosie@newstartmag.co.uk