Toronto’s GFL Behind Canada’s First Large-cap Private Equity Deal of 2016

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( — March 11, 2016) — Canada’s first large-cap private equity deal for 2016 came from an unexpected sector, waste management. Earlier this month, Green For Life Environmental Inc. (GFL), a Toronto-based environmental services company operating in all provinces in Canada except Prince Edward Island, closed the multimillion dollar deal they had been planning since late last year. GFL’s $800 million dollar acquisition of solid waste business Matrec Services was made possible by a group of international investors who helped raise the capital needed for GFL to buy Matrec from its parent company, TransForce.

“The deal, announced in October, paid TransForce $775 million upfront with the promise of a further $25 million in four years,” wrote Kirk Faulkner for PE Hub.

The equity deal between GFL and TransForce made the short list of the Top 10 Private Equity Deals in Canada last year. The merger of Matrec under the GFL umbrella was called an add-on deal and took the sixth spot on the PE Hub list.

GFL’s strategic purchase of Matrec will allow the company’s growing environmental services operation access to an eastern Ontario landfill adjacent to the Ottawa market. “The Matrec deal will help us continue GFL’s growth and expansion into new markets and environmental service areas,” Patrick Dovigi, GFL’s founder and Chief Executive Officer, said.

A company statement from October highlights the benefits of the acquisition. “This transaction solidifies GFL’s position as a leader in the Canadian environmental services industry by expanding our solid waste operations into Eastern Ontario and Quebec,” the statement reads. “We expect the Matrec division to generate approximately $82 million of EBITDA in 2016, pre-synergies.”

Since its establishment in 2007, GFL has quickly grown to service the environmental needs of many of Canada’s largest and most diverse markets. Currently, GFL serves more than 1.7 million households and roughly 39,000 commercial and industrial businesses across the country, a number the company expects to grow in the coming years.

The optimistic growth projection has been spurred on by the company’s previous success, as well as the deal with TransForce. “The Matrec acquisition was backed by an equity investment of $458 million. Nearly 86 percent of the amount came from an infrastructure fund managed by Australia’s Macquarie Group,” wrote Faulkner.

The additional purchase capital was made available by a consortium led by Highbridge Principal Strategies, a private equity firm affiliated with American-based JP Morgan.

Notably, GFL’s acquisition of Matrec has more than doubled the company’s value, from last year’s $950 million to approximately $2.4 billion today.

GFL isn’t all about solid waste management and disposal. Prior to closing the Matrec deal, GFL bought Anchor Shoring Group, a firm specializing in shoring and foundation work. Anchor Shoring will bolster GFL Excavating Corp., a robust branch of GFL that has been increasingly active in the excavation and soil remediation business in and around Ontario, Canada.  

Commenting on the acquisition of Anchor Shoring Group, Patrick Dovigi said, “The combination of Anchor with GFL creates a unique, integrated platform from which we can serve all of our clients’ demolition, excavation, shoring and foundation needs.”

The Matrec acquisition has helped grow the GFL workforce to over 2,700 employees. GFL is now operational in every province, except Prince Edward Island.

“GFL was born from the concept of providing comprehensive, all-inclusive environmental services,” added Patrick Dovigi. “We see GFL doubling in size by 2021.”