Billionaire Bill Gates is buying more Republic Services stock. According to filings with the SEC, his investment company Cascade Investment, LLC has purchased 4 million shares of stock between Dec. 7 and Dec. 9 for about $108 million. He now owns 65.15 million shares representing about 17.5 percent of the company. The recent purchases are taking advantage of a yearly low point in the stock which most analysts expect to reach $35.
The business is attractive for its relative stability and high cash flows. Republic more than doubled its sales through its merger with Allied Waste and achieved synergies, in excess of expectations and ahead of schedule. For its third quarter ended Sept. 30, the company exceeded analyst expectations for its fourth consecutive quarter, reported substantially stronger net income and revenue boosted by volume and pricing growth...Read More »
Veolia Environnement surprised many with its announcement last week of its intent to sell its US waste business as part of an ambitious plan to raise 5 billion Euros ($6.7 billion) from asset sales to reduce debt. Its US waste business had revenues 614 million Euros ($822 million) in 2010. The next question is who will buy it, how much, and on what terms?
Veolia's decision to sell its US waste business is the latest sign of a missed opportunity. After entering the US waste market in 1999, many believed that the world's largest utility and second largest waste company would make other US acquisitions.
Some analysts believe the company could sell for $1.5 billion. That restricts the number of eligible suitors to other large waste companies, private equity groups, or more likely some combination thereof. The deal could also be broken up into pieces but Veolia will likely prefer a less complicated transaction that will yield the cash it needs to reduce debt by 2013.
Among companies most likely to be interested are also the largest players: Waste Connections (Folsom, CA), Progressive Waste Solutions Ltd. (Toronto, ON), Republic Services (Phoenix, AZ), and Waste Management (Houston, TX). Private equity firms like Highstar Capital (which owns Advanced Disposal and Interstate Waste), Blackstone, Apollo Management, Ares Management or others may also be interested...Read More »
Waste Connections, Inc. (Folsom, CA) has made good on its threat and now plans to move its corporate headquarters to The Woodlands, Texas, just north of Houston. The move is to begin immediately and be complete by September next year. Earlier this year company CEO Ron Mittelstaedt cited a tough "business climate" and a "dysfunctional" state Legislature among many reasons for leaving. However, as the company has expanded eastward, it has become increasingly important to seek a more central location, particularly to a city that is a hub for airlines. Denver, Chicago, Houston and Austin were the top contenders. Mittelstaedt added that Texas' warmer temperatures, business-friendly climate and a lack of a state income tax were also factors. Meanwhile, "California has the highest state tax rates in the nation, and they're going higher," Mittelstaedt said.
The move is expected to cost the company about $15 million, but it will cost Sacramento County where it is the largest private company, a great deal more in lost economic benefit. Mittelstaedt estimates the firm generates about $80 million to $100 million a year in direct salaries, payroll taxes, payments to vendors and outside contractors and other local expenditures...Read More »
EPA Administrator Lisa Jackson recently indicated that her agency will issue a scientific analysis of the potential health risks from beneficial reuse of coal ash in products such as cement late next year. The EPA has been weighing whether to regulate coal combustion residuals (CCRs) as solid waste under subtitle D of the Resource Conservation & Recovery Act (RCRA) or subject to stricter hazardous waste controls under subtitle C. EPA's plans to release the study ahead of the final rule means that it will likely shape the final decision. In remarks made on Dec. 6, Jackson allowed that her agency had no scientific risk data on the beneficial reuse of CCRs even though it has been allowed and that the agency should not be making judgments without such data...Read More »
Industry and many Republicans continue to push for a legislative fix despite EPA's issuance of less stringent and more flexible boiler and incinerator air rules. Prospects for the legislative fix remain unclear, since President Obama has threatened a veto and as GOP Sens. Olympia Snowe (ME) and Susan Collins (ME), key sponsors of the bill to overhaul the air rules, say they now plan to review EPA's new proposed rules before proceeding further.
EPA Dec. 2 released its revised package of rules for boilers and incinerators, including national emission standards for hazardous air pollutants for major source boilers and area source boilers, new source performance standards for commercial and industrial solid waste incinerators (CISWI) and a non-hazardous secondary materials (NHSM) rule to determine whether facilities are subject to the boiler or CISWI rules based on the material burned in the unit. Changes include the removal of strict numeric limits on dioxins from boilers and offering more flexibility in meeting the standards...Read More »
Pat DeRueda, President of WM Recycle America (WMRA), a division of Waste Management, Inc. (Houston, TX), is leaving his post there to move closer to home and family in Arizona. He will be switching positions in the company and is to become vice president of the company's Arizona and New Mexico area at the start of the new year. Waste Management expects to name a successor for DeRueda at WMRA by then. DeRueda will succeed Area Vice President Dan Vermeer who is joining a new unit focused on optimizing the company's enterprise-wide network of materials recovery, transfer and disposal assets.
"Pat leaves WMRA in great shape," said David Steiner, CEO. "What was once a majority owned subsidiary of WM known as Recycle America Alliance became under Pat's leadership a fully integrated, wholly owned subsidiary that is now regarded as the leader in the global recycling industry."...Read More »
The Environmental Industry Associations (EIA) announced that Joseph "Joe" Quarin, currently COO of Progressive Waste Solutions (Toronto, ON), but soon to take over after when Keith Carrigan retires at the end of the year, has joined the association's Board of Trustees. The EIA represents the private sector solid waste and recycling industry through two sub-associations, the National Solid Wastes Management Association (NSWMA) and the Waste Equipment Technology Association (WASTEC). "We are pleased and fortunate that Joe has agreed to serve in leadership roles on the EIA Board of Trustees. He exemplifies the best qualities found in the leaders of our member companies," said Bruce Parker, EIA's President and CEO...Read More »
Waste Management, Inc. (Houston, TX) is increasing its investment in waste-to-fuel developer Enerkem (Montral, QC) which along with EB Investments is investing another C$15 million for a minority equity interest in Enerkem Alberta Biofuels L.P., a full-scale commercial facility being built in Edmonton, AB. Enerkem broke ground on the project in October after signing an offtake agreement in September with Methanex Corp. which has agreed to buy methanol produced by the Edmonton plant. The Edmonton facility is one of two plants that will produce 10 million gallons of biofuel per year; a second similar facility is being developed in Pontotoc, MS. Enerkem employs a gasifier to convert mixed wastes and residues into a pure synthesis gas (or syngas) that can then be converted into chemicals or biofuels using chemical catalysts. Total financing raised by Enerkem in 2011, both at the corporate and project subsidiary levels, now amounts to C$103 million...Read More »
Waste Management, Inc. (Houston, TX) has fired up a new landfill gas-to-energy plant at its Prairie View Landfill in Wilmington, IL which it operates for Will County. Three 20-cylinder 2,233-horsepower Caterpillar engines will produce enough electricity to power 1,000 homes which will be sold to ComEd, a division of Exelon. That will generate an estimated $440,000 per year in revenue to the county. Illinois utilities are expected to derive 25 percent of their power from renewable sources by 2025. Methane production is expected to rise over time at the 3,500 ton-per-day landfill since it only began operating in 2004 and has yet to hit its stride...Read More »
Advanced Disposal Services, Inc. (Jacksonville, FL) said it opened a $1.5 million state-of-the-art transfer station in Mobile, AL. Waste processed through the transfer station will be hauled to the company's Turkey Trot Landfill in south Washington County, which opened in May this year. "Our Mobile Transfer Station is designed with the customer in mind for more efficient operations and thus a cleaner, safer option for everyone's disposal needs," said Dave Lavender, Advanced Disposal regional vice president. The company also recently expanded its customer base in Alabama after it bought Lowndes Garbage Service, LLC, its tenth acquisition this year...Read More »