By Dominic Chopping

STOCKHOLM--Swedish private-equity firm EQT AB said Wednesday that it has agreed to buy Covanta Holding Corp. in a deal worth $5.3 billion.

New Jersey-based Covanta owns and operates 41 waste-to-energy facilities in metropolitan areas across the U.S., Canada and Europe, providing an alternative to landfilling waste.

The deal, which was unanimously approved by Covanta's board, will see EQT Infrastructure pay Covanta shareholders $20.25 in cash per share, a 36% premium to Covanta's share price of $14.86 on June 8, the day prior to initial media speculation of a transaction.

Covanta's three diversified and complementary business segments comprise waste processing and services, energy production and metals recycling, and the company is expected to generate adjusted earnings before interest, tax, depreciation and amortisation of $460 million to $480 million in 2021, EQT said.

With this transaction, EQT Infrastructure V is expected to be 50% to 55% invested, it added.

The transaction is subject to customary conditions and approvals and is expected to close by year end.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

07-14-21 0838ET