Summary
Republic Services, Inc. (RSG) announced the completion of its merger with Allied Waste Industries, Inc. on December 5, 2008. This significant event, structured as a reverse merger where Allied became a wholly-owned subsidiary of Republic, resulted in Allied's stockholders receiving approximately 52% ownership of the combined entity in the form of Republic common stock. Allied's stock has been delisted from the NYSE. This transaction is expected to create a larger, more integrated waste management company, although the immediate financial implications will be detailed in future filings, including pro forma financial information due within 71 days. The merger also involved significant changes to Republic's corporate governance and financial obligations. Republic's Board of Directors has been expanded and reconstituted to include former Allied directors, establishing a new governance structure designed to balance the interests of both former companies during a "Continuation Period." Additionally, Republic and its subsidiaries have entered into supplemental indentures to guarantee existing debt obligations of Browning-Ferris Industries, LLC (BFI) and Allied Waste North America Inc. (AWNA), adding approximately $3.7 billion in guaranteed principal amount of debentures and senior notes, bringing the total outstanding principal amount of guaranteed debt as of November 30, 2008, to over $550 million for BFI debentures and over $4.7 billion for AWNA senior notes. Investors should monitor future filings for detailed financial performance and integration updates.
Key Highlights
- 1Completion of the merger between Republic Services, Inc. (RSG) and Allied Waste Industries, Inc. on December 5, 2008.
- 2Allied stockholders received approximately 52% ownership of the combined company in the form of RSG common stock; Allied's stock delisted from NYSE.
- 3Republic's Board of Directors expanded from seven to eleven members, incorporating former Allied directors and establishing a new "New Republic Governance Structure" for a "Continuation Period."
- 4Republic and its subsidiaries entered into supplemental indentures to guarantee BFI's 9.25% debentures ($99.5M outstanding) and 7.40% debentures ($360M outstanding).
- 5Republic and its subsidiaries also guaranteed AWNA's senior notes, totaling approximately $4.7 billion in outstanding principal as of November 30, 2008.
- 6Key executive changes include the appointment of Donald A. Slager as COO and President, and Timothy R. Donovan as Executive Vice President, General Counsel and Secretary.
- 7Pro forma financial information related to the merger will be filed via amendment within 71 days.