Mergers & acquisitions

Departments - Industry News

August 2, 2019

Photo by Julia Drozdowsky | Angle Media Group

GFL Environmental announces two acquisitions within a week

GFL Environmental Inc., Ontario, Canada, announced in July that it will acquire the Soil Safe group of companies, based in Columbia, Maryland, in its second acquisition announcement within a week. The transaction closed July 5, and financial details were not disclosed.

Patrick Dovigi, GFL’s founder and CEO, told Waste Today that the acquisition added new markets in California. Dovigi says the acquisition is in line with the company’s goal of replicating all its existing services across the continent.

Since its inception in 1989, Soil Safe has recycled more than 30 million tons of non-hazardous petroleum-contaminated soil for beneficial reuse outside of landfills.

"Soil Safe and its management team, led by Mark Smith, are recognized as industry leaders in contaminated soil recycling and the development of inert soil products for beneficial use in sustainable construction and green building applications. GFL is one of the largest processors of contaminated soils in Canada, and our acquisition of Soil Safe is in keeping with our strategy of replicating all of our service offerings in the U.S.," Dovigi says. "Soil Safe's in-house expertise and recycled products complement and extend our existing capabilities as we build our infrastructure business to service our customers' needs across North America. We are excited to welcome Soil Safe and its employees to the GFL team."

The acquisition comes at the heels of GFL’s acquisition of Toronto-based Canada Fibers Ltd., which the company announced July 5. That transaction is expected to close in the third quarter of 2019.

Dovigi says that acquisition “will create new opportunities to provide integrated collection, sorting, processing and marketing of recyclable materials."

Dovigi says the close timing of the acquisitions was coincidental. The purchase of Canada Fibers depended mostly on the commodity market, which has hit record lows since China implemented its National Sword policy.

"We were fortunate to watch what happened with commodities over the past year. It's tougher to buy recycling businesses when commodity values are extremely high," Dovigi says. "On the commodity sales side, we believe it's very close to the bottom."

GFL made waves last year when it merged with Raleigh, North Carolina-based Waste Industries. The merger, which more than doubled GFL's footprint of operations in North America, was expected to take place over the course of a year. Dovigi says integration is almost complete and has "been a very smooth process with very like-minded teams."

Acquisition activity is likely to continue in the second half of the year as GFL pushes forward with a swath of new companies under its belt.

"I think we look at anything that makes sense in any of our existing offerings. It's a complete coincidence that these happened at the same time, but GFL being what it is, we're always looking at ways to be greener," Dovigi says.

"I think we'll continue to look at opportunities to be a little bit different and a little bit greener."

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US Ecology to merge with NRC Group Holdings Corp.

US Ecology Inc., Boise, Idaho, announced June 24 that it has entered into a definitive merger agreement with NRC Group Holdings Corp. (NRCG), a Houston-based provider of compliance and waste management services to the marine and rail transportation, general industrial and energy industries. The agreement was comprised of an all-stock transaction with an enterprise value of $966 million. The transaction is expected to close in the fourth quarter of 2019, subject to clearance approvals.

“The addition of NRCG’s substantial service network strengthens and expands US Ecology’s suite of environmental services,” says Jeffrey Feeler, president, CEO and chairman of US Ecology. “This transaction will establish US Ecology as a leader in standby and emergency response services and adds a new waste vertical in oil and gas exploration and production landfill disposal to further drive waste volumes throughout the Gulf region.”

NRCG is one of two leading national Oil Spill Removal Organizations (OSRO) that provide mandated standby emergency response for the transportation of oil products. With more than 50 service centers, NRCG has a national service network providing emergency and spill response, light industrial services, hazardous and industrial waste management and transportation services. From a growing base of disposal assets in the two key oil basins in the Gulf region, the Permian and the Eagle Ford, NRCG provides landfill disposal of waste from oil and gas drilling, treatment and handling of residual waste streams and rental and transportation services to support its disposal operations.

“NRCG will bring highly complementary services and customers to US Ecology and will position the combined company as a leading player in industrial waste management while strengthening its position in the overall environmental services market,” says Christian Swinbank, president and CEO of NRCG. “We believe the combination will provide compelling upside for stockholders of both companies.”

The transaction has been approved by both companies’ boards of directors. Upon completion of the transaction, US Ecology stockholders will own approximately 70 percent of the combined company, and NRCG stockholders will own approximately 30 percent on a fully diluted basis. The combined company will use the US Ecology name, and its shares will continue to be listed on the Nasdaq Global Select Market under the ticker ECOL. Feeler will continue to serve as president, CEO and chairman of the board of directors. The company will maintain its headquarters in Boise, Idaho, with regional support centers in Boise, Detroit, New York and Houston.