An investor group including BC Partners and Ontario Teachers’ Pension Plan agreed to back Toronto-based GFL Environmental in a recapitalisation that valued the waste management company at $4 billion.
The investors are buying the interest of existing GFL stakeholders, but “significant ownership” will remain with the company’s founder and chief executive Patrick Dovigi, according to a statement. Dovigi will continue in the chief executive position.
Transaction cost and how large an interest in GFL the investors will hold was not disclosed. The deal will close by 30 June, the statement said.
BC Partners and OTPP did not reply to requests for comment.
The deal values GFL, one of the largest waste management providers in North America, at C$5.13 billion ($4 billion; €3.27 billion), according to a statement. The company manages 5,000 employees and 140 facilities across Canada and Michigan, which provide services in solid waste management, liquid waste management and infrastructure management to more than 2.5 million households and 60,000 businesses.
BC Partners, an international investment firm with more than €17 billion in AUM, led the investor group in acquiring the interest of HPS Investment Partners, Macquarie Infrastructure Partners III and Hawthorne Equity Partners. HPS and Hawthorne first invested in GFL in 2014, while Macquarie joined in 2016, providing nearly all of a $458 million investment that helped GFL acquire solid waste business Matrec Services.
“Having founded the company, it was very important to me to find partners that shared the same principles, values and vision, along with having significant capital to fund our ambitious growth plans,” Dovigi said in the statement.
“We look forward to a close collaboration with GFL and our partners at Ontario Teachers’ as an important part of our long-term strategy to grow in the Canadian marketplace,” BC Partners co-chairman Raymond Svider added.
Since last autumn, reports circulated that GFL was considering making an initial public offering in the first quarter of 2018, but the recapitalisation appears to put that plan on hold for now. According to a report from Moody’s Investors Service, GFL had close to C$1.5 billion in revenue last year.