Solid Waste & Recycling


Marsulex to acquire Stablex

Marsulex Inc. has announced that it has agreed to purchase Stablex, a Quebec-based business specializing in inorgan...

Marsulex Inc. has announced that it has agreed to purchase Stablex, a Quebec-based business specializing in inorganic hazardous waste treatment and disposal, for approximately $73 million, excluding acquisition and financing costs.

The transaction will be funded substantially with debt and in addition to the customary closing conditions, is contingent upon Marsulex arranging suitable financing. Discussions with bankers for $80 million acquisition financing and a $20 million revolver for general corporate use are well advanced. The company expects to complete the transaction in approximately six weeks.

Stablex, which is based in Blainville, Quebec, commenced operations in 1983 and uses a technology to treat and stabilize inorganic industrial hazardous wastes and contaminated soils. The Stablex process consists of making contaminants insoluble in the environment by using a chemical treatment followed by stabilization and solidification processes before disposal of the benign product in a dedicated secure placement cell.

Laurie Tugman, president and chief executive officer of Marsulex, said the acquisition is an excellent fit with Marsulex’s core capabilities and also broadens the company’s services and customer base.

“Stablex is using state-of-the-art technology to provide a critical service to its industrial customers. It has an outstanding record for safe and reliable operations and a high retention rate for customers,” he said.

Mr. Tugman said Stablex is a strong, stable business that produces good margins and will add significantly to Marsulex’s earnings. “The business generated revenue in 2004 of approximately $38 million and gross profit of approximately $18 million. Selling, general and administrative costs and maintenance capital expenditures are expected to be $7.0 million and $1.7 million per annum, respectively. Stablex management has built a very sound business and has relationships with more than 1,000 industrial customers upon which we can build.”

Marsulex, which is based in Toronto, Ontario, is an industrial services company with a focus on outsourced environmental compliance services. The company’s services encompass the complete outsourcing of environmental compliance activities including the ownership and operation of compliance assets.

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