Merseyside Waste Disposal Authority and Covanta Energy have reached an "amicable settlement of their dispute" that ends the legal battle over the awarding of a contract to an operator in the North East.
In a brief statement issued on Friday, a spokesman for MWDA said Covanta has agreed not to pursue its claim against MWDA. The statement went on: "As the terms of the settlement are confidential, the parties will not be commenting further on the details of that resolution."
A trial was due to be held in spring 2014 at the High Court after Covanta, which plans an energy-from-waste plant in a joint venture with Peel on the banks of the Manchester Ship Canal near Frodsham, secured an injunction barring MWDA from entering into a contract with its rival SITA.
The 30-year waste management contract is worth £1.2bn and took seven years to procure.
SITA UK was awarded the contract in April. The appointment means waste from Merseyside will be transported to the North East. There were numerous calls from North West politicians to call for a rethink, including Ellesmere Port & Neston MP Andrew Miller and Liverpool mayor Cllr Joe Anderson.
SITA UK will build a transfer station at Knowsley Industrial Park from where 430,000 tonnes of waste from Merseyside and Halton will be taken to an energy-from-waste facility in Teesside.
Law firm Pinsent Masons advises Covanta. Eversheds advises MRWA.