GFL Environmental stock price falls as waste company shuts down strategic review

Résumé détaillé

Special committee rejected take-private offer that valued the company at $22-billion

GFL Environmental Inc. GFL-T share price dropped sharply after the waste disposal company formally shut down a review of unsolicited takeover offers and opted to remain public.

Early Tuesday, the price of GFL shares fell around 10 per cent at US$41.36 in early trading on the New York Stock Exchange.

The decline came after the company said in a press release a special committee of its board concluded a four-month negotiation with potential private equity buyers and “unanimously determined that remaining a public company is the best path forward for all shareholders.”

On Monday, The Globe and Mail reported GFL’s special committee turned down bids for US$52 per share from a consortium of Wall Street private equity fund managers. The offer valued GFL at US$22-billion and would have been one of the largest take-private transactions seen in Canadian markets.

“The special committee concluded that while the range of valuations proposed were based on a premium to where GFL currently trades, that is not reflective of the full value of our standalone strategy,” said Dino Chiesa, chair of the special committee, in a press release on Tuesday.

“The board is unanimous in its conviction that GFL’s standalone growth plans offer far superior risk-adjusted returns for shareholders,” said Mr. Chiesa. “We remain open to considering any proposal that is in the best interests of shareholders.”

GFL was founded in Vaughan, Ont., in 2007 by entrepreneur and current chief executive officer Patrick Dovigi, who built a company known for its bright green garbage trucks through a series of takeovers. It is now headquartered in Miami.

Analysts said GFL’s decision to end the review without a sale of the company should have a relatively small medium to long-term impact on the stock price.

“While the potential ‘no deal’ outcome could drive some downside to shares tomorrow, we have been pointing investors to the recent run-up in waste sector valuations that should moderate the potential downside from here,”…

Début de l'article, extrait de The Globe and Mail (Report on Business). Pour lire la suite, ouvrez l'article chez le média.