A Co Tipperary haulage company is in negotiations with a US waste management group to invest more than €15 million on a tyre-recycling plant at an undisclosed location in the Shannon region and two in Britain.
Silvermines-based Midwest Transport said yesterday that it had commenced due diligence on a potential deal with EarthFirst Technologies of Tampa, Florida.
EarthFirst said it would build a tyre-recycling plant in the Republic and two in Britain, which it will sell to Midwest for $6.5 million (€5.13 million) each under the terms of a licensing agreement with the Irish company. The licence will cost Midwest Transport a once-off fee of $700,000.
"We're in a due-diligence process. We've seen the technology and we're excited by its capability," said Midwest Transport chief financial officer Tim Ryan.
"We feel that it's environmentally friendly and that it will solve the environmental problem in this country caused by scrapped tyres. Subject to satisfactory due diligence and planning approval, the first plant would be established in the Shannon region," he said.
The deal under discussion represents EarthFirst's second attempt to enter the Irish market. It signed a letter of intent last year to acquire Advanced Environmental Solutions (Ireland) but no transaction took place.
While the planning process has begun, EarthFirst suggested in a statement that the first Irish catalytic activated vacuum distillation plant could be operational within eight months.
It said the $6.5 million price on each plant was exclusive of the cost of shredding or generation equipment and shipping charges.
Each plant would be capable of processing a minimum of 48 tonnes of spent tyres per day. The by-product of the recycling process can be used in the production of carpets, among other products.
The principal in Midwest Transport is Newport-based businessman Thomas Creagh. The company is likely to establish an affiliate to manage the recycling business if contracts are signed.
EarthFirst specialises in technology that processes and breaks down solid and liquid waste, including products such as tyres, oils and engine anti-freeze.
It said that the licensing agreement with Midwest Transport was for five years and was renewable for an additional five years.
EarthFirst would receive royalties equivalent to 7.5 per cent of gross sales of carbon, oil and steel by-products produced from the "remediation" of tyres processed in each plant. The royalty stream would continue for the life of each plant, estimated at 10 years.
