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Waste Management revised terms of Advanced Disposal acquisition
Posted on Friday, 26 June 2020 06:14
Waste Management has reduced its offer to acquire Advanced Disposal Services to USD 4.60 billion, including USD 1.80 billion of debt.
Under the terms of the agreement, the Houston-headquartered buyer will pay USD 30.30 per share in cash, representing a 2.8 per cent discount to the group’s close of USD 31.16 on 23rd June 2020, the last trading day prior to the announcement.
The news comes after Waste Management agreed to acquire Advanced Disposal for USD 4.90 billion, including USD 1.90 billion in debt, or USD 33.15 apiece, in April.
At the time, the companies said the Florida-based waste collection and treatment services will be delisted from the New York Stock Exchange and completion is expected by the end of the first fiscal quarter of 2020, subject to the usual raft of approvals.
The deal is now expected to close by the end of the third quarter of 2020, following the green light from regulators and majority of shareholders, including Canada Pension Plan Investment Board, which owns around 18.0 per cent of Advanced Disposal.
Waste Management and Advanced Disposal announced they have entered into an agreement for GFL Environmental to acquire a combination of the two companies’ assets for USD 835.00 million, representing around USD 345.00 million in total revenue based on 2019 results.
The buyer expects annual cost and capital expenditure synergies to exceed the USD 100.00 million previously announced.
Jim Fish, chief executive of Waste Management, said: “Over the last several months, as we have worked to gain regulatory approval from the US Department of Justice, we have become increasingly convinced that the people and customer additions this acquisition brings to Waste Management will be of tremendous value and we are confident that Waste Management’s operational excellence will allow us to achieve expected synergies.”
Advanced Disposal is the fourth-largest non-hazardous solid waste management company in the US, as measured by revenue, and provides non-hazardous solid waste collection, transfer, recycling and disposal services for residential, commercial and industrial customers.
The group has 2.80 million residential customers, over 200,000 commercial and industrial clients and over 800 municipal consumers.
In the three months ended 31st March 2020, Advanced Disposal posted service revenue of USD 386.70 million, compared to USD 384.00 million in the corresponding period of 2019.
Net loss totalled USD 6.30 million in Q1 2020, compared to USD 6.00 million in Q1 2019.
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