IESI-BFC Ltd. and Waste Services, Inc. announced that their respective boards of directors have approved a definitive merger agreement between the two companies. The combined firm, to be headquartered in Toronto, will have revenues of close to $1.5 billion. The newly formed company will service customers in 11 states and six Canadian provinces. The deal is expected to close by the end of the first quarter of next year.
The acquisition will combine IESI-BFC's and WSI's collection, transfer, recycling and landfill businesses under Keith Carrigan, IESI-BFC's vice chairman and CEO. The combined company will be diversified across U.S. and Canadian markets, customer segments and service lines, while maintaining a commitment to excellent customer service, environmental stewardship, and community support. The combined company will use its excess free cash flow to fund organic growth, maintain IESI-BFC's regular quarterly dividend payments to shareholders, finance accretive strategic acquisitions and reduce debt.
"In uniting with WSI, IESI-BFC will advance to a top-three position in the North American solid waste management industry," said Carrigan. "More importantly, this transaction will allow our two companies to grow more meaningfully than they could on their own. Through this combination, we will increase our internalization in the Canadian market, where we have demonstrated our ability to improve margins by applying our highly successful business model. We will also establish a meaningful presence in the Florida market, where WSI has initiated a vertical integration strategy centered around the JED landfill, one of the most valuable solid waste assets in the state.