Osborne Park-based Tox Free Solutions says it is set to become the national leader in the hazardous waste industry after announcing a deal to purchase DoloMatrix International for $58 million.
The deal follows a string of acqusitions by Tox Free, most recently being the $4 million purchase of Mackay Maintenance yesterday.
Sydney-based DoloMatrix has four operating businesses, namely national hazardous waste collection and destruction services companies Chemsal and BCD Technologies, and specialist environmental consulting businesses Entech Industries and Waste Audit.
DoloMatrix’s board of directors have unanimously recommended their shareholders vote in favour of the transaction.
In a statement Tox Free said the new companies were expected to deliver, in aggregate, earnings before interest, taxes, depreciation and amortization (EBITDA) of $11.5 million in the 2012 financial year.
Excluding transaction costs, Tox Free is acquiring the companies at five times the estimated EBITDA.
The acquisition will be funded through a fully underwritten institutional placement of $27 million and a committed debt facility of $40 million with ANZ.
The placement will be undertaken by way of a bookbuild from base price of $1.91 per share and will result in a maximum issue of around 14.1 million new ordinary shares.
In addition, Tox Free will offer a share purchase plan at 4pm WST today to eligible shareholders the opportunity to acquire up to $10,000 new shares.
Morgan Stanley is acting as sole financial adviser on the acquisition, and sole bookrunner and joint lead manager with Evans & Partners on the institutional placement.
Clayton Utz is acting as legal adviser on the acquisition.
Tox Free said DoloMatrix’s highly experienced employee base will add significant value the company’s intellectual capital and capabilities.
Tox Free managing director Steve Gostlow said Chemsal and BCD Technologies will enhance Tox Free’s earnings and asset base, and will position Tox Free as the industry leader in the hazardous waste sector.
“Hazardous waste management is an attractive market for Tox Free, with strong growth underpinned by increased processing of hazardous materials and demand for specialist treatment and destruction services.”
Tox Free shares were steady at $2.08 at 12.30pm WST.
