Clean Harbors announced it has entered into a definitive agreement to acquire HydroChemPSC (HPC), from an affiliate of Littlejohn & Co., LLC, for $1.25 billion in an all-cash transaction.
HPC is a leading U.S. provider of industrial cleaning, specialty maintenance and utilities services. The acquisition, which is subject to regulatory approval and other customary closing conditions, is expected to close in 2021.
With more than 240 service locations throughout the country, HPC serves a broad range of end markets including refining, chemical and utilities. Its services are built around providing solutions to customers focused on cleaning, maintenance and environmental compliance of essential, mission critical equipment and infrastructure.
“In a business where brand equity, customer service and reputation for safety are important, HPC is a recognized leader with terrific assets that will enhance our Environmental Services capabilities, particularly in the higher-value areas of specialty work and facility services,” said Alan S. McKim, Chairman, President and Chief Executive Officer of Clean Harbors. “This acquisition highlights our disciplined approach to M&A, which is geared around accretive transactions that create multiple cross-selling opportunities and drive waste into our network.”
HPC expects to generate revenues of approximately $744 million in 2021, with full-year Adjusted EBITDA of approximately $115 million. Clean Harbors estimates it can achieve cost synergies of $40 million from the acquisition after the first full year of operations, which would equate to a purchase multiple of 8.1 times on a post-synergized basis. The Company expects to fund the acquisition through a combination of available cash and the issuance of additional debt.
