GFL closes its acquisition of Terrapure

GFL Environmental Inc., Ontario, Canada, announced Aug. 17 that it has closed the previously announced acquisition of the solid waste and environmental solutions business of Terrapure Environmental Ltd. and its subsidiaries. The acquisition excludes Terrapure’s battery recycling business.

On March 15, GFL announced that it had entered into a definitive agreement to acquire the solid waste and environmental solutions business of Terrapure for an aggregate purchase price of $743.8 million.

Terrapure is an Ontario-based integrated provider of solid and liquid waste management and industrial services to more than 7,000 customers across Canada. Terrapure's environmental and organics solutions cover a diverse range of waste streams from generation through collection, processing, recovery, recycling, reuse and disposal. These services are managed through the company’s integrated network of assets, including its landfill and its liquid and solid waste collection and processing facilities. Terrapure's operations are supported by a fleet of more than 500 collection vehicles and approximately 1,600 employees. 

Terrapure's operations acquired in the acquisition generated revenue of approximately $292.7 million in 2020, inclusive of COVID-related volume impacts. 

According to GFL, the acquisition advances the company’s growth strategy and aligns with the company's goal of growing free cash flow.

During the initial announcement of the deal, GFL laid out three ways the acquisition will benefit the company:

It will enhance GFL’s capabilities and reach. According to the company, the acquisition brings a high-quality, complementary asset network and customer base to GFL's existing operations and augments GFL's existing service offerings in several regional markets, including Atlantic Canada. As part of the acquisition, GFL will acquire the Stoney Creek landfill, an industrial landfill strategically located in the greater Toronto area which recently received expansion approval for 14-plus years.

It will create significant synergies. According to the company, the acquisition creates an opportunity for GFL to realize meaningful synergies and earnings accretion. The company expects the acquisition to generate at least $36.1 million of adjusted free cash flow and at least $10 million in annual cost synergies through operational opportunities from geographical and functional overlap between the existing operations of Terrapure and GFL.

It will create long-term shareholder value. According to the company, the acquisition reinforces GFL's goal of creating long-term equity value for shareholders. Terrapure's strategically located network of assets coupled with its strong operating margins are expected to be immediately accretive to free cash flow and provide opportunities for the company to continue to pursue its growth strategy.

"The acquisition of Terrapure is another example of GFL delivering on our commitment to pursue strategic and accretive acquisitions to continue growing our business," Patrick Dovigi, founder and CEO of GFL, says. "Terrapure brings a high-quality, complementary network of assets and customer base to our existing solid and liquid waste operations and expands our service offerings in several regional markets. This strategically located network of assets and Terrapure's strong operating margins are expected to be immediately accretive to free cash flow and provide opportunities for us to continue to pursue our growth strategy."

"We are excited to welcome the over 1,600 Terrapure employees to the GFL family," Dovigi concluded.