GFL Environmental Shares Climb on $835 Million Acquisition

GFL Environmental is benefiting from the acquisition announced by Waste Management of Advanced Disposal Services.
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GFL Environmental  (GFL) - Get Report said Wednesday it agreed to buy a portfolio of assets for $835 million in a deal resulting from a rival company's acquisition.

Shares of the Vaughan, Ontario-based waste-management company were up 2.2% to $18.40.

The agreement stems from Waste Management's  (WM) - Get Report announced acquisition of Advanced Disposal Services  (ADSW) - Get Report for $4.6 billion. 

GFL Environmental will buy a combination of the two companies' assets for $835 million in a move is designed to satisfy divestitures expected to be required by the U.S. Department of Justice.

The acquisition is subject to certain customary closing conditions, GFL said, including approval by the Justice Department's approval and the closing of the WM-ADS transaction. 

The acquisition is not subject to any financing conditions, GFL said, and is expected to close in the third quarter, following the WM-ADS transaction.

Patrick Dovigi, GFL's founder and CEO, said in a statement that the acquisition presents the company "with a unique opportunity to significantly expand our U.S. footprint through the acquisition of a high quality, vertically integrated set of assets in both our existing and adjacent fast growing U.S. markets."

The assets to be acquired include 32 collection operations, 36 transfer stations and 18 landfills supported by 380 collection vehicles across 10 U.S. states.

"We are excited to welcome over 900 employees of WM and ADS to the GFL family and are confident that we will continue to offer excellent customer service to our expanded customer base," Dovigi said.

GFL said it currently anticipates funding the acquisition through a combination of capacity under its revolving credit facility and cash on hand, but will evaluate other longer-term opportunities.