Private Equity Firms Turn to Waste and Recycling Companies
M&A activity in the waste and recycling industry has increased over the past couple of years, with 2022 posting strong results. While the industry’s top publicly traded companies have been highly acquisitive this year, they are experiencing increased competition from private equity firms and infrastructure funds competing for deals. Private equity firms have increasingly sought reliable environmental services in their portfolio, expanding the definition of infrastructure to include fleets or even customer contracts.1
Unemployment Rates for Professional and Business Services Sector Rising
Recent layoffs in the professional and business services sector raised the unemployment rate in Q4, according to data from the U.S. Bureau of Labor Statistics. In October and November, the unemployment rate increased to 3.5% and 3.7%, respectively, a significant jump from 2.9% in September. The increase in unemployment comes as companies reduce part of their workforce amid tightening margins, driven by a cooling economy and the Federal Reserve's continued rate hikes.2
Growing Backlogs for Landscaping Companies
While sales for new projects are on the rise, fast-growing inflation, fluctuating material costs, and supply chain bottlenecks are causing landscaping companies to experience growing backlogs. According to a survey by Lawn and Landscape, 43% of companies posted backlogs of more than six weeks for construction projects. Over the past months, landscaping companies have witnessed an uptick in project size, scope, and budget, as companies bid projects higher to offer competitive prices.3
BP Completes $4.1 Billion Acquisition of Archaea Energy
BP completed its $4.1 billion acquisition of Archaea Energy, a major developer of renewable natural gas projects at waste sites. The acquisition marks a milestone in the company’s strategic bioenergy business with the addition of Archaea’s 50 RNG and landfill gas-to-energy projects in the U.S. An additional 80 projects are in development. Republic, which shares a $1.1 billion joint venture with Archaea, waived their “change in control rights,” which would be triggered by the transaction's closing.4 5
Largest Transactions Closed
- Nielsen Holdings plc
- Brookfield Business Partners L.P.; Evergreen Coast Capital Corp.
- PSG Global Solutions, LLC
- Teleperformance SE
- Hill International, Inc.
- Global Infrastructure Solutions Inc.
- Kessler Financial Services, L.P.
- Stone Point Capital LLC
- Equus Workforce Solutions
- APM Human Services International Limited
- St. Charles Consulting Group, LLC
- NIIT (USA), Inc.
Other Financial Buyer Transactions Closed
- Quorum Hotels & Resorts, Ltd.
- Somera Capital Management, LLC
- Ethisphere LLC
- Alpine Management Services III, LLC
- Terry, Lockridge & Dunn, Inc./World Trend Financial Planning Services, Ltd.
- Savant Capital, LLC
Other Strategic Buyer Transactions Closed
- Csuite Financial Partners LLC
- Kingsway Financial Services Inc.
- Intellectual Property Management Company, Inc.
- CentralNic Group Plc
- Wipro Opus Risk Solutions LLC
- Loaninghub, Inc.
- Management Partners Inc.
- Baker Tilly US, LLP
- Public Sector Advisory Practice of Grant Thornton
- Guidehouse LLP
This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.
EBIT - Earnings Before Interest and Taxes