GFL to sell Delaware waste business to Casella
Less than five years after acquiring Waste Industries, the Canadian waste management company GFL Environmental plans to leave Delaware by selling its mid-Atlantic business to Vermont-based Casella Waste Systems.
Known here for its neon green waste bins that populated neighborhoods from Middletown to Millsboro, GFL operates commercial and residential services. It’s the fourth largest diversified environmental services company in North America, serving more than 4 million households and 135,000 commercial and industrial customers.
Its mid-Atlantic solid waste operations in Delaware, Southeastern Pennsylvania and Northeast Maryland are geographically isolated from its major service network in the U.S. South and Canadian provinces though. It acquired Waste Industries for $2.825 billion in 2018, marking one of the waste industry’s largest deals then to date.
On April 21, GFL reached a $525 million deal for nine hauling operations, one transfer station, and one material recovery facility with Casella, a publicly traded regional company based in Rutland, Vt. The operations have aggregate annualized revenues of about $185 million.
The acquisition is expected to close by the third quarter of 2023, subject to customary closing conditions, including regulatory approvals.
Included in the deal to be financed with cash, credit and newly issued debt are the Delaware North transfer station in Townsend and the Delaware South transfer station in Millsboro. About 570 total employees would reportedly be impacted by the sale, according to Waste Dive, an industry publication.
The acquisition would mark a southern expansion for Casella, which currently has operations in Maine, Vermont, Massachusetts, New Hampshire, Connecticut, New York and northern Pennsylvania.
“Today’s announcement marks an important step forward in the company’s growth strategy by using the strength of our balance sheet and proven capital discipline to make a compelling investment,” said John W. Casella, chairman and CEO of Casella Waste Systems, in a statement announcing the deal. “After successfully extending our footprint into the adjacent Connecticut market with an acquisition in mid-2021, this acquisition will enable us to expand into the mid-Atlantic region with these well-run solid waste operations that provide a platform for future growth.”
Casella said his company completed an extensive due diligence period and has started a collaborative integration and transition planning process. The deal marks one of the largest expansions by Casella Waste Systems, which completed 14 deals worth $51 million in annualized revenues last year.
“Over the last five years we have built a strong team focused on successfully integrating and driving returns from acquisitions. In addition, our existing team includes several talented professionals who have experience with these specific operations and markets, which provides us even more confidence around a successful integration process to drive further shareholder returns,” Casella said. “We look forward to welcoming the hardworking GFL employees to our team. And, we look forward to the opportunity to provide excellent service to our new customers and the communities that GFL currently serves in these markets.”
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