Republic Services to Acquire US Ecology – A Leading Environmental Solutions Company

Republic Services-US Ecology infographic

– Allows Republic Services to offer customers market-leading environmental solutions via a national footprint that includes vertically integrated assets and extensive capabilities

Republic Services will offer a complete range of products and services after closing. This will meet customers’ demands for a single-source partner with a proven track record of sustainability.

Republic expects that the transaction will immediately be accretive for adjusted earnings and cash flow. $40 millionCost synergies are expected to be achieved in the first three years

– Provides a platform to accelerate growth, including cross-selling opportunities as well as additional tuck in acquisitions

PHOENIX BOISE, Idaho, Feb. 9, 2022/PRNewswire/. Republic Services, Inc., (NYSE: RSG), and US Ecology, Inc., (NASDAQ-GS; ECOL) have reached a definitive agreement where Republic Services will acquire all outstanding shares from US Ecology. $48Cash per share, with a total value approximately $2.2 BillionInclude net debt of approximately $0.7 billion.

US Ecology is a major provider of environmental solutions, including treatment, recycling, and disposal of hazardous, specialty, and non-hazardous wastes. US Ecology’s twelve-month trailing revenue as of September 30, 2021It was $968 MillionAdjusted EBITDA was $156 million.⁽¹⁾

“Today’s announcement allows Republic Services to offer customers one of the most comprehensive product offerings in the environmental services space and creates significant benefit for our stakeholders,” stated Jon Vander Ark (president and chief executive officer of Republic Services). “This strategic acquisition expands the U.S. geographic footprint and creates significant value for our stakeholders.” CanadaProvides vertical integration capabilities to our environmental solutions business.”

“We are pleased to have achieved this agreement with Republic Services,” said Jeff Feeler. He is also the chairman and chief executive officer of US Ecology.2022 marksThe 70th anniversary of US Ecology^ThYear of operations, centered around providing environmental solutions to protect the environment and human health. Combining our companies gives us a platform to accelerate the common strategy of providing an entire range of environmental solutions to improve our world. This transaction also highlights the value of US Ecology’s businesses, providing stockholders with attractive, certain value. It also brings together a network with extensive environmental solutions expertise to address customers’ most complex and challenging needs. I want to thank US Ecology’s employees and their dedication to this cause. We look forward working with the Republic Services team in order to complete the transaction, and deliver premium products.

Strategic and Financial Benefits

Vertically integrates Republic’s environmental solutions footprint. The acquisition of US Ecology will add a national platform of difficult-to-replicate assets and talent to enable Republic to provide customers environmental solutions from collection through disposal. This includes the addition of nine specialty waste landfills, five hazardous waste landfills and 16 RCRA-permitted TSDFs. There are also seven wastewater treatment facilities and more than 80 locations for environmental services, including recycling centers.

Positions Republic is a single-source partner for customers Customers who require multiple recycling and waste services will appreciate the opportunity to consolidate their services with a single partner with a proven track record of safety and compliance. Republic will now be able to offer customers a complete range of environmental services, including recycling, special waste, hazardous and container rental, as well as field services.

Expects to see financial success and to create synergies. Republic will be able to leverage its core capabilities, standard operating model, and investment in digital to increase profitability across the new portfolio. Republic expects that the transaction will immediately add to adjusted earnings as well as free cash flow. Republic anticipates approximately $40 millionIn cost synergies within three-years of the acquisition, expected double-digit returns. The combined company’s adjusted free-cash flow conversion is expected be at least 47 per cent by 2024.

Increases growth opportunitiesRepublic’s environmental solutions capabilities and footprint will expand, creating the potential for significant revenue growth. Cross-selling opportunities will be possible between existing customers of Republic Ecology and Republic. Republic will also have the opportunity to acquire additional pieces of the highly fragmented environment solutions business through the acquisition of US Ecology.

Financing The transaction is free from any financing conditions. Republic Services plans to finance the transaction with existing and new debt sources.

Republic Services plans to maintain a strong balance and an investment-grade rating after the transaction is completed. The Company expects net debt-to EBITDA to fall below 3x within the first 18 months after closing the transaction.

Timing and Approvals The boards of directors of both companies unanimously approved the transaction. It is expected that the transaction will close by the end the second quarter subject to satisfaction of customary closing condition, including regulatory approvals and approvals by holders of a majority share of US Ecology’s common Stock.

Advisors Moelis & Company LLC will serve as the exclusive financial adviser to Republic Services. Davis PolkRepublic Services’ legal counsel is & Wardwell LLP. US Ecology is served as co-financial advisers by Barclays PLC, Houlihan Lokey Capital, Inc. Dechert LLP serves as US Ecology’s legal counsel.

About Republic Services
Republic Services, Inc. is a leader within the U.S. environment services industry. The Company offers superior service offerings through its subsidiaries while working with customers to create more sustainable worlds. Visit www.sustainability.org for more information. republicservices.comFollow us at Facebook.com/RepublicServices, @RepublicServices on Twitter and Republic Services LinkedIn.

The Company participates in investor presentations throughout the year. A schedule of these conferences is available to interested parties at republicservices.com.

About US Ecology
US Ecology is a leader in providing environmental services to government and commercial entities. The company provides complex waste management services to its customers. It offers treatment, disposal, beneficial reuse, recycling, and radioactive waste. US Ecology offers a range of vertically integrated field services, including logistics and response at customers’ in-field locations as well as through its network 10 day transfer facilities. Special waste packaging, collection lab packs, transportation, and total management are all part of the logistics solutions. Response solutions include emergency responses, oil spill response standby, spill clean-up, remediation and industrial services. US Ecology is committed to safety, environmental compliance, best-in-class customer services, and a focus on customer satisfaction. This allows us to efficiently meet the needs and build long-lasting relationships. Since 1952, US Ecology has been protecting our environment. For more information, visit www.usecology.com.

INFORMATION REGARDING FORWARDLOOKING STATEMENTS

This press release contains forward-looking information about us. It is intended to be covered under the safe harbor for “forward looking statements” provided in the Private Securities Litigation Reform Act of 1996. Forward-looking statements refer to statements that are not historical facts. Forward-looking statements are identified by words such as “guidance”, “expect”, “may,” and “anticipate,” and similar expressions. These statements contain information about our plans and strategies, as well as our prospects. Forward-looking statements don’t guarantee future performance. These statements are based on the current beliefs and expectations that our management has. They are subject to risks and uncertainties that could cause actual results not to be as expected. Although we believe that the forward-looking information and statements are reasonable, it is impossible to guarantee that they will be true. There are many factors that could cause actual outcomes to differ materially with those projected in forward-looking statements. These include the effects of the COVID-19 Pandemic and any actions taken in response, acts war, riots, or terrorism, as well as the impact of these events on economic, financial, and social conditions. The United StatesOur dependence on large, long term collection, transfer, and disposal contracts, our pending purchase of US Ecology, Inc., increases the risk that the transaction will not be completed in a timely matter. The failure to satisfy the conditions for consummation of transaction, the effect of the announcement of the transaction on Republic’s or US Ecology’s existing business relationships, operating outcomes, and business overall. Management may also be distracted from ongoing business operations. The outcome of any legal and regulatory proceedings related to the merger deal or the transaction, Republic will implement its forecasts and realize additional growth. Additional information on factors that could lead to actual results or events differing materially is provided in reports filed with Securities and Exchange Commission (“SEC”), such as our Quarterly Report on form 10-Q for quarter ended September 30, 2021Particularly under Part II, Item 1A Risk Factors. There are always new risk factors that emerge. It is impossible for us to predict them all or to determine the impact they might have on our business. We do not assume any obligation to publicly update forward-looking information as a result or future events or new information except as required under law.

⁽¹⁾Represents US Ecology’s adjusted EBITDA for twelve months ended September 30, 2021. US Ecology’s adjusted EBITDA measure is not GAAP. For more information on US Ecology’s non-GAAP measures, please see the press releases and the accompanying tables filed with the SEC using form 8-K. A reconciliation of adjusted EBITDA and the GAAP measure is also available.

Additional Information and Where to Find It

This communication could be considered solicitation material in relation to the proposed merger between a US Ecology subsidiary and Republic Services. US Ecology will file with the SEC a proxy declaration in connection to the contemplated transaction. The definitive proxy statement will be sent to or given to US Ecology stockholders. It will contain important information regarding the contemplated transaction. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE. Investors and security owners can obtain a free copy (if it is available) of the proxy statement and any other documents filed with SEC at the SEC’s website at www.sec.govContact US Ecology’s Investor Relations department at no charge or obligation. Alison Ziegler at [email protected].

CERTAIN INFORMATION CONCERNING THE PARTICIPANTS

US Ecology and its directors, and executive officers, may be considered participants in the solicitation for proxies from US Ecology’s stockholders to support the contemplated deal. Information about US Ecology’s directors and executive officials can be found in the proxy statement for its 2021 Annual meeting of Stockholders. This proxy statement can be downloaded at no cost from the SEC’s website, www.sec.gov. The proxy statement that US Ecology will file with the SEC will include additional information about the interests of participants in solicitation of proxy in connection to the contemplated transactions.