Cleanaway to buy Tox Free Solutions
Cleanaway is to buy Tox Free Solutions, which services the healthcare and infrastructure sectors, for around $671m.
Cleanaway Waste Management has agreed to buy Tox Free Solutions, which provides services to the healthcare and infrastructure sectors, for around $671 million.
Cleanaway (CWY) is offering $3.425 in cash for each Tox share, and said it would fund the deal through a mix of new equity and debt. Tox Free shareholders will also be eligible for a 5c a share interim dividend.
Cleanaway Chief Executive Vik Bansal forecast savings totalling about $35 million from the deal, and said he expects it to boost earnings and cash flow significantly by adding “prized infrastructure assets across the country, as well as contributing an exciting new business in the form of a leading, vertically integrated provider of healthcare waste management products and services.”
Cleanaway will launch a fully underwritten 1-for-3.65 pro rata entitlement offer to raise $590 million and draw down a new debt facility to fund the deal.
New shares would be offered to investors at $1.35 each, representing an 8.2 per cent discount to Friday’s closing price.
Tox Free (TOX) has been vulnerable to a takeover since losing a major waste management contract with Chevron at its Gorgon liquefied natural gas project, although the company has partially offset the revenue loss by picking up additional contracts, including with BHP Billiton at its Olympic Dam mine.
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