(Reuters) - Britain's Shanks Group Plc (L:SKS) said on Thursday it was in talks to buy Dutch recycler van Gansewinkel Groep BV in a deal valued at about 440 million euros (377 million pounds) on a debt-free cash-free basis.
VGG shareholders would get about 510 million euros, including 306 million in cash and a share consideration of up to 204 million euros, representing 29 percent shares in the combined company.
Mergermarket reported in May that Van Gansewinkel was being sold by its consortium of creditors and those participating in the auction included Germany's Remondis
Shanks Group said the deal had a 'compelling' strategic rationale with significant potential cost synergies.
A combination of Van Gansewinkel with Shanks or Suez Environment would bring together two of the three largest players in the Dutch recycling market, a consolidation analysts say is needed to reduce overcapacity.
($1 = 0.9028 euros)