The sale is expected to be concluded by the end of 2012, subject to approval by US antitrust authorities.
Veolia Environnement, as a result of the transaction, will reduce the debt on its books by $1.82bn.
The company, however, will continue to be a player in the hazardous waste and industrial services segment.
Speaking of the offloading, Veolia Environnement chairman and chief executive officer Antoine Frérot called it the second significant step in the execution of the strategic plan envisioned in December 2011.
Veolia Environnment had laid out a $5bn disinvestment program expected to be wrapped up by the end of 2013.
Star Atlantic Waste Holdings is a portfolio company of Highstar Capital, a US-based infrastructure fund manager.
