WCA Waste Corporation to be acquired by Macquarie Infrastructure Partners II
WCA Waste Corporation has entered into an agreement and plan of merger with Macquarie Infrastructure Partners II (MIP II), a North American infrastructure investment fund.
Under the terms of the agreement, MIP II will acquire all of the outstanding common stock of WCA for $6.50 per share in cash, redeem all Series A preferred stock and either partially or completely refinance WCA’s existing credit facilities. The transaction is valued at approximately $526 million. The purchase price represents a premium of 30 percent over WCA’s closing stock price on December 20, 2011.
WCA’s operations consist of 25 landfills, 29 transfer stations and 29 collection operations. Headquartered in Houston, Texas, WCA serves approximately 450,000 customers in 14 states in the Southeast and Midwest United States.
The board of directors of WCA has unanimously approved the transaction. In addition to the approval of WCA stockholders, the transaction is subject to customary closing conditions, including certain regulatory approvals. The transaction is expected to be completed in the first quarter of 2012.
The transaction will be financed through a combination of shareholder capital from MIP II and new underwritten credit facilities. The new credit facilities will be used to provide liquidity going forward, refinance WCA’s existing credit facilities, and may also be used to refinance WCA 7 ½ percent senior notes due in 2019. A total of up to $275 million of the new credit facilities may be drawn at close if none of the notes remain in place, and this new facilities drawdown will be scaled back to the extent the notes do remain in place. As part of the transaction, WCA will be required to make a change of control offer pursuant to the notes indenture.
Following completion of the transaction, WCA’s common stock will cease to be traded on NASDAQ.