GFL Environmental, Inc. (GFL) revealed that it has acquired the solid waste management and recycling business of Peoria Disposal Company (PDC) and its affiliates for an undisclosed amount. The company also provided an update on its M&A activity year-to-date as the company continues to expand its existing footprint.
Shares of the waste management company have gained 67% over the past year. (See GFL Environmental stock charts on TipRanks)
Notably, the company has completed 31 acquisitions year-to-date, including 16 acquisitions across its North American platform. GFL utilized its recent bond offerings, upsized credit facility, proceeds from asset sales, as well as available cash to finance its recent acquisitions.
PDC offers residential, commercial, and industrial solid waste hauling and recycling services. It owns a vertically integrated network of assets in Central Illinois and Eastern Missouri, supported by a fleet of more than 350 vehicles and over 400 employees.
The addition of PDC will complement GFL renewables and enhance the company’s sustainability initiatives by unlocking great value from landfill gas to energy projects at the PDC landfills.
Markedly, GFL also completed the acquisition of the Alabama Dumpster group of companies, which provides commercial and roll-off solid waste and recycling services and landfill operations in Alabama.
Additionally, the company continues to dispose of its non-core assets, in line with its strategy of redeploying capital towards organic and inorganic opportunities in its main growth markets.
Notably, the company said that it has sold certain solid waste assets around the Chicago, Illinois market and Rochester, Minnesota, other than the Zion Landfill, for $72.5 million. Furthermore, the company has inked several disposal arrangements, including a 10-year disposal agreement for 450,000 tons per year at the Zion Landfill.
The above-mentioned deals bring GFL’s total proceeds from asset sales to $122.5 million for the year.
GFL CEO Patrick Dovigi said, “We continue to demonstrate our ability to successfully execute on our growth strategy of pursuing strategic and accretive acquisitions.”
Dovigi further added, “The acquisition of PDC provides us with a unique opportunity to acquire one of the best family owned and operated vertically integrated set of assets in the United States, while expanding our solid waste footprint within the U.S. Midwest.”
National Bank analyst Rupert Merer recently increased the price target on the stock from C$46 to C$50 (5.7% upside potential) and maintained a Buy rating.
Overall, the stock has a Strong Buy consensus rating based on 7 Buys and 2 Holds. The average GFL Environmental price target of $38.99 implies 4.2% upside potential from current levels.