Clean Harbors, Inc. (NYSE:CLH), Monday announced it has inked a deal to buy Safety-Kleen, Inc. for $1.25 billion, furthering its environmental services business in North America.
The environmental, energy and industrial services provider said privately-held Safety-Kleen is the largest re-refiner and recycler of used oil in North America and a “leading provider” of parts cleaning and environmental services.
Safety-Kleen generated revenue of $1.3 billion in 2011, and collects and processes about 200 million gallons of used oil yearly.
Clean Harbors said it expects the acquisition will be immediately accretive, excluding one-time fees and acquisition-related expenses.
The company has received a financing commitment from Goldman Sachs Bank (NYSE:GS), but said it is also considering “several financing options” for the transaction.
The deal is subject to approval by U.S. and Canadian regulators, and is expected to be completed by year-end.
“This acquisition is a landmark achievement for Clean Harbors that we believe will build significant long-term value for our shareholders,” said chairman and CEO Alan S. McKim.
McKim added that the company has had “a long and positive relationship” with Safety-Kleen as a result of acquiring its chemical services division 10 years ago.
“The addition of its entire organization aligns perfectly with our acquisition strategy of expanding our environmental services business in North America.”
Clean Harbors said the deal will enable it to crack the small quantity waste generator market and expand its waste treatment capabilities to include re-refining waste oil and expanded solvent recycling capabilities.
Additionally, it said that the acquisition will drive “a substantial increase” in waste volumes into its existing waste disposal treatment network and “maximize” cross-selling opportunities.
Looking ahead, Clean Harbors said its focus will be on gaining the necessary approvals, planning its integration and completing the acquisition by year-end.
Safety-Kleen is a used oil recycling and re-refining, parts cleaning and environmental solutions company, with approximately 4,200 employees serving more than 200,000 customer locations in the U.S., Canada and Puerto Rico.
Clean Harbors provides environmental, energy and industrial services throughout North America, serving more than 60,000 customers.
Headquartered in Norwell, Massachusetts, it has more than 200 locations, including over 50 waste management facilities, throughout North America in 38 U.S. states, seven Canadian provinces, Mexico and Puerto Rico.
Clean Harbors said it will be announcing its third-quarter results on November 7.