business

Ecolab Inc. has agreed to buy New York-based Ecovation Inc., a wastewater effluent management firm that caters to food and beverage manufacturers.

St. Paul-based Ecolab is paying an initial $210 million for Ecovation, but the ultimate purchase price will be lower because Ecolab plans to sell $40 million of long-term lease receivables. That should lower the net purchase price to $170 million.

Ecovation installs on-premise wastewater treatment systems that help dairy, beverage, meat and poultry producers filter out the waste contained in effluent water that goes down their drains.

Cleaner effluent not only helps the environment by reducing the work for municipal water treatment centers, it also lowers the treatment fees that customers pay their municipalities.

The Ecovation anaerobic wastewater treatment, solids management and air pollution controls also allow wastewater to be recycled. Some systems also allow customers to extract energy from their wastewater streams that can be used in their plants.

Evocation has been growing rapidly. It generated $50 million in sales for 2007 and is on pace to reach $100 million this year. Ecovation's proprietary technologies are catching on because they help food and beverage processors comply with increasingly stringent environmental regulations, Ecolab officials said.

Doug Baker, Ecolab CEO, said the acquisition "greatly expands the range of solutions Ecolab can provide to its food and beverage processing customers.''

"Ecovation's technologies allow food processing plants to be more environmentally responsible while simultaneously reducing operating costs. For Ecolab, it opens exciting new growth prospects in our second-largest global business and in an area where we have achieved consistent strong growth and global market leadership," Baker added.

Dee DePass • 612-673-7725