Waste Management, Inc.NYSE
Tue, Jan. 5, 9:56 AM
- Progressive Waste Solutions (BIN +6.5%) opens higher after saying it has begun a review of strategic alternatives, confirming an earlier report that it may be considering a sale.
- Logical buyers could include Waste Connections (WCN -0.2%) and Republic Services (RSG +0.2%), both of which can afford a 25% buyout premium and still have a deal be accretive to their earnings even before factoring in any cost savings, but they may be reluctant to take on more debt, and RSG has said that while it is focused on growing via acquisition, those will probably total just ~$100M/year.
- Waste Management (WM -0.1%) arguably is even more likely to pass on BIN, Bloomberg's Gillian Tan writes, as its stock has lagged most competitors except BIN, it is focused on smaller acquisitions, and antitrust hurdles provide an obstacle as the industry's biggest player.