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Clean Harbors, Inc. (“Clean Harbors”) (NYSE:CLH), the leading provider of environmental, energy and industrial services throughout North America,
today announced it has signed a definitive agreement to acquire Safety-Kleen, Inc. (“Safety-Kleen”), the largest re-refiner and recycler of used oil in North America and a leading provider of parts cleaning and environmental services. Under the terms of the agreement, Clean Harbors will purchase Safety-Kleen in an all-cash transaction valued at $1.25 billion. The acquisition is subject to approval by U.S. and Canadian regulators, as well as other customary closing conditions. The transaction is expected to be completed by year-end.
Based on the current operating and anticipated future performance of Safety-Kleen, Clean Harbors expects the acquisition will be immediately accretive, excluding one-time fees and acquisition-related expenses. The Company has received a financing commitment from Goldman Sachs Bank USA, but is currently considering several financing options for the transaction that may include a combination of existing cash, debt and equity.
The transaction will enable Clean Harbors to:
Penetrate the small quantity waste generator market
Broaden its waste treatment capabilities to include re-refining waste oil and expanded solvent recycling capabilities
Drive substantial increase in waste volumes into its existing waste disposal treatment network
Capitalize on the growing demand for recycled products including re-refined oil
Enhance its commitment to sustainability
Leverage the combined sales forces to maximize cross-selling opportunities
Add an immediately accretive business to accelerate growth
Leverage operating efficiencies through the combined company
Add to its strong cash flow generation
“This acquisition is a landmark achievement for Clean Harbors that we believe will build significant long-term value for our shareholders,” said Alan S. McKim, Chairman and Chief Executive Officer. “Safety-Kleen is a recognized leader in the environmental services field with a corporate heritage that dates back nearly 50 years with a strong service culture. We have the benefit of a long and positive relationship with Safety-Kleen as a result of our acquisition of its Chemical Services Division a decade ago. Safety-Kleen has been a large customer of our environmental services business. The addition of its entire organization aligns perfectly with our acquisition strategy of expanding our Environmental Services business in North America. Safety-Kleen is the largest collector of waste from the small quantity generator market and the leader in re-refining used oil in North America.”